Report of the Directors
As of 31 December 2008, the Group’s deposits placed with SA Finance amounted to RMB1,138,896,000.
(4) China Southern West Australian Flying College Pty Ltd (the “Australian Pilot College”), which is 91% owned by the Company and 9% owned by CSAHC
CSAHC and the Australian Pilot College entered into an agreement dated 7 October 1993 for the provision of pilot training in Australia to the cadet pilots of the Group (the “Training Agreement”). The Training Agreement will remain in force unless terminated by either party upon 90 days’ prior written notice to the other party. Pursuant to the De-merger Agreement, the Company has assumed all the interests, rights and obligations of CSAHC under the Training Agreement. The Company acquired a 26% equity interest in Australian Pilot College from CSAHC in December 2008, and Australian Pilot College became a 91% owned subsidiary of the Company.
For the year ended 31 December 2008, the amount payable by the Group to the Australian Pilot College for training services was RMB45,248,000.
(5) Freight Agency Agreement
The Company has entered into Ticket Agency Agreements for the sale of the Group’s air tickets with several subsidiaries of CSAHC (the “Agents”). The Agents charge commission on the basis of the rates stipulated by the CAAC and International Air Transport Association (“IATA”) and rates agreed on through negotiation between the parties. The Company has other air ticket sales agents in China who also charge commission at the same rates.
The Company and China Southern Airlines Group Passenger and Cargo Agent Company Limited (“PCACL”), a wholly-owned subsidiary of CSAHC have entered into the Framework Agreement on Expanded Businesses Including the Sale of Air Tickets, the Airfreight Forwarding Services, Chartered Flight and Pallets Agency Services, Delivery Services For the Outside Storage Area and the relevant Internal Operation Services For the Inside Storage Area of China Southern Airlines Company Limited dated 10 January 2008 (the “Freight Agency Agreement”), which is valid from 1 January 2008 to 31 December 2010. Pursuant to the Freight Agency Agreement, the cooperative scope of both parties thereto mainly comprises extended businesses including air ticket sales agency services, airfreight forwarding sales agency services, chartered flight and pallets agency services, internal operation services for the inside storage area, and delivery services for the outside storage area and chartered flight and pallets sales agency business. The annual transaction cap of the sales value shall not exceed RMB250 million.
For the year ended 31 December 2008, the amount of ticket and cargo sales of the Group conducted through the above sales arrangement was RMB134,404,000.
ANNUAL REPORT 2008
Report of the Directors
(6) Guangzhou China Southern Airlines Property Management Company Limited (the “GCSAPMC”), which is 100% owned by CSAHC
The Company and GCSAPMC entered into a Framework Agreement for the Engagement of Property Management (“Property Management Framework Agreement”) dated 1 January 2006 to engage GCSAPMC to provide property management and improvement service for a term of three years from the date of this agreement. Pursuant to the agreement, the Company has appointed GCSAPMC to provide management and maintenance services for the Company’s headquarters in Guangzhou and to provide maintenance and management services for the 110KV transformer substation to ensure the ideal working conditions of the Company’s production and office facilities and physical environment, and the normal operation of equipment. The fee charging schedule (or charge standard) shall be determined on an arm’s length basis between both parties, and shall not be higher than the one charged by any independent third parties in the similar industry. The annual cap for the Property Management Framework Agreement is set at RMB47,010,000. As such agreement expired on 31 December 2008, the Company renewed the Framework Agreement for the Engagement of Property Management with GCSAPMC on 29 December 2008 for a term of three years from 1 January 2009 to 31 December 2011, and there is no change in the scope of services and the annual caps.
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本文鏈接地址：CHINA SOUTHERN AIRLINES COMPANY LIMITED ANNUAL REPORT 2008(17)
