Xinhua FTSE Index will Continue to Calculate and License Indices

Xinhua FTSE Index will Continue to Calculate and License Indices

October 31, 2006

Restriction of Information not in Line With Prime Minister Wen Jiabao's statement "Information in the Areas of Commerce, Finance and the Economy Will Flow Freely Without any Restrictions"

       

    SHANGHAI, China, HONG KONG and LONDON, Oct. 31
/Xinhua-PRNewswire/ -¨C Xinhua FTSE Index (XFI), the
leading China index provider, announced that the company
has decided to appeal the case to a higher court following
the court ruling in Shanghai received today and reiterated
that the company will continue to calculate its suite of
indexes for the domestic and international investment
community regardless of the expiry of the contract with SSE
InfoNet. 

    Fredy Bush, Co-chairman of XFI, said, "We have
other contractual arrangements in place which allow us to
calculate indices in China. In addition, obviously, index
providers such as MSCI, S&P/CITIC, Dow Jones do not
need a contract in China to calculate China equity indices
and license investment products. We believe we should be
treated in the same way as these index providers."

    "Despite this ruling, XFI's business operation
will not be affected in any way. XFI will move to appeal
the case as we maintain our stance that there had been no
violation of our contract with SSE InfoNet. We are
disappointed at the ruling," added Bush. "We own
our indices and have the right to license others to develop
derivatives. XFI regrets that its contract with SSE Infonet
will not be renewed, and that strenuous efforts on its part
to settle the ongoing court action have not been
successful." 

    XFI receive the stock data necessary to calculate the
China equity indices from a 10-year agreement signed
between Shanghai Securities News, a wholly owned subsidiary
of Xinhua News Agency and Xinhua Financial Network (a wholly
owned subsidiary of Xinhua Finance Limited), the partner
company of FTSE in the joint venture Xinhua FTSE Index. The
agreement was signed in 2001 in Hong Kong and is governed by
HK law.
 
    The overall climate in China is moving toward one of
openness and transparency. Chinese Premier Wen Jiabao,
speaking at a conference in London in September 2006
reinforced his goal that the Chinese government will ensure
foreign media and information providers enjoy reporting
freedom and rights. "Information in the areas of
commerce, finance and the economy will flow freely without
any restrictions" he confirmed. 

    Bush said, "China accession to WTO ensures the
continuous opening of China's market and fair competition
here. It is of great significance to China being part of
the global economy. XFI is merely seeking the right to
compete on a level playing field with other organisations
and to continue to offer index products to the
market."

    Since 2001, XFI has operated within China and
internationally, to develop highly successful indexes which
meet the needs of investors and have contributed to the
ongoing development of Chinese equity markets. It remains
committed to continue to playing a part in the healthy
development of China's markets. 

    More information about Xinhua FTSE Index Ltd and its
product suite is available at http://www.xinhuaftse.com or
from press offices below. 

    About Xinhua FTSE Index 

    Established in late 2000, Xinhua FTSE Index (XFI), a
joint venture between Xinhua Finance Limited and FTSE, came
into being to facilitate the creation of real-time indices
for the Chinese market. The indices can be used as a basis
for the trading of derivatives, index-tracking funds,
Exchange Traded Funds and as performance benchmarks. The
combination of FTSE's expertise in international indexing
with Xinhua Finance's strong presence and capabilities in
China creates a level of expertise in the Chinese market
that is unprecedented. Providing the combined coverage for
the Shanghai and Shenzhen exchanges, all of the Xinhua FTSE
indices are designed according to internationally proven
index methodology to ensure products are transparent, clear
and consistent. For daily data and further information,
please visit http://www.xinhuaftse.com .

    About FTSE Group

    FTSE Group is a world-leader in the creation and
management of indices. With offices in London, Frankfurt,
Hong Kong, Madrid, Paris, New York, San Francisco, and
Tokyo, FTSE Group services clients in 77 countries
worldwide.  It calculates and manages the FTSE Global
Equity Index series, which includes world-recognised
indices ranging from the FTSE All-World Index, the
FTSE4Good series and the FTSEurofirst Index series, as well
as domestic indices such as the prestigious FTSE 100. The
company has collaborative arrangements with the Athens,
AMEX, Cyprus, Euronext, Johannesburg London, Madrid, NASDAQ
and Taiwan exchanges, as well as Nomura Securities, Hang
Seng and Xinhua Finance of China, FTSE recently signed an
agreement with Dow Jones Indexes to develop a single sector
classification system for global investors.

    FTSE indices are used extensively by investors
world-wide for investment analysis, performance
measurement, asset allocation, portfolio hedging and for
creating a wide range of index tracking funds. Independent
committees of senior fund managers, derivatives experts,
actuaries and other experienced practitioners review all
changes to the indices to ensure that they are made
objectively and without bias.  Real-time FTSE indices are
calculated on systems managed by Reuters. Prices and FX
rates used are supplied by Reuters.  

    About Xinhua Finance Limited 

    Xinhua Finance Limited is China's unchallenged leader
in financial information and media, and is listed on the
Mothers board of the Tokyo Stock Exchange (symbol: 9399)
(OTC ADRs: XHFNY). Bridging China's financial markets and
the world, Xinhua Finance serves financial institutions,
corporations and re-distributors through four focused and
complementary service lines: Indices, Ratings, Financial
News and Investor Relations.  Founded in November 1999, the
Company is headquartered in Shanghai with 20 news bureaus
and offices in 19 locations across Asia, Australia, North
America and Europe. For more information, please visit
http://www.xinhuafinance.com . 

    For more information, please contact:  

    Hong Kong/Shanghai
     Joy Tsang
     Xinhua Finance 
     Tel:   [phone]
            [phone]
            [phone]
     Email: [e-mail]

    Beijing
     Catherine Song
     Xinhua FTSE Beijing office 
     Tel:   [phone]
     Email: [e-mail]

    London
     Sandra Steel
     FTSE Group 
     Tel:   [phone]
     Email: [e-mail]

SOURCE  Xinhua FTSE Index