Annual Report 2021

Report of the Directors 66 CHINA MERCHANTS PORT HOLDINGS COMPANY LIMITED million), respectively. On 24 December 2021, in view of the expiry of the 2021 CMPG Services Framework Agreement on 31 December 2021, CMPG and the Company entered into a new services framework agreement (the “ 2022 CMPG Services Framework Agreement ”) for a term of two years commencing on 1 January 2022 and ending on 31 December 2023. The resolved to set the annual caps in respect of the service fees for the provision of port and port-related services receivable by the Group from CMPG Group as RMB17 million (equivalent to approximately HK$20.73 million) and RMB23 million (equivalent to approximately HK$28.05 million) for the year ending 31 December 2022 and for the year ending 31 December 2023, respectively, and the annual caps in respect of the service fees for port and freight forwarding services payable by the Group to CMPG Group as RMB10 million (equivalent to approximately HK$12.2 million) and RMB13 million (equivalent to approximately HK$15.85 million) for the year ending 31 December 2022 and for the year ending 31 December 2023, respectively. CMPG is a substantial shareholder of the Company, and accordingly, CMPG is a connected person of the Company. (iv) On 19 December 2019, the Company and China Merchants Finance entered into a financial services agreement (the “ 2020 Financial Services Agreement ”) for a term of three years commenced on 23 December 2019 and ending on 22 December 2022 to set out the framework for future transactions in relation to (i) the depositing of money by the Group with China Merchants Finance; (ii) the provision of clearing and settlement services by China Merchants Finance; (iii) the provision of loans and other credit services by China Merchants Finance; (iv) the provision of foreign exchange clearance and settlement services and (v) the provision of other financial services (including wealth management, securities underwriting and financial consultancy services). With respect to the depositing of money by the Group with China Merchants Finance at any point of time during the term of the 2020 Financial Services Agreement, the Directors resolved to set the maximum amount of deposit at HK$2,100 million. With respect to (i) the fees payable by the Group for the provision of clearing and settlement services; (ii) the fees payable by the Group for the provision of foreign exchange clearance and settlement services and (iii) the fees payable by the Group for the provision of other financial services for each of the years ending 31 December 2020, 2021 and 2022 under the 2020 Financial Services Agreement, the Directors resolved to set the annual caps at HK$10 million, HK$10 million and HK$10 million, respectively. The maximum amount of deposit placed by the Group during the year ended 31 December 2021 was HK$1,843 million. No fee was paid and payable by the Group for the provision of clearing and settlement services, foreign exchange clearance and settlement services and other financial services for the year ended 31 December 2021. China Merchants Finance is a subsidiary of CMG, the ultimate holding company of the Company, and accordingly, a connected person of the Company. (v) On 17 December 2020, the Company and CMIT entered into a comprehensive services framework agreement (the “ 2021 CMIT Comprehensive Services Framework Agreement ”) to set out the framework for future transactions in relation to the provision of technology consulting services, software development and information systems integration services by CMIT to members of the Group for a term of one year commenced on 1 January 2021 and ended on 31 December 2021. On the same day, the Directors resolved to set the annual cap in respect of the service fees payable by the Group to CMIT Group under the 2021 CMIT Comprehensive Services Framework Agreement for the year ended 31 December 2021 at RMB180 million (equivalent to approximately HK$214.29 million). The amount of service fees paid and payable by the Group to CMIT in connection with the services in the year ended 31 December 2021 was RMB156.2 million (equivalent to approximately HK$188.2 million). On 24 December 2021, in view of the expiry of the 2021 CMIT Comprehensive Services Framework Agreement on 31 December 2021, the Company and CMIT entered into a new comprehensive services framework agreement (the “ 2022 CMIT Comprehensive Services Framework Agreement ”) for a term of one year commenced on 1 January 2022 and ending on 31 December 2022. The Directors resolved to set the following annual cap in respect of the service fees payable by the Group to CMIT for the year ending 31 December 2022 at RMB300 million (equivalent to approximately HK$366 million). CMIT is a subsidiary of CMPG, a substantial shareholder of the Company and accordingly, CMIT is a connected person of the Company. (vi) On 17 December 2020, CMPG and CMIT entered into a new comprehensive service framework agreement (the “ 2021 CMPG IT Services Framework Agreement ”) for a term of one year commenced on 1 January 2021 and ended on 31 December 2021 for the provision of information services by CMIT to certain subsidiaries of CMPG. The Directors resolved to set the annual cap in respect of the service fees receivable by CMIT under the 2021 CMPG IT Services Framework Agreement for the year ended 31 December 2021 at RMB110 million (equivalent to approximately HK$130.95 million). Since CMPG is a substantial shareholder of the Company, CMPG is a connected person of the Company. In addition, as at 17 December 2020, CMIT was held by the Company and CMPG as to 76.84% and 23.16%, respectively. Accordingly, CMIT was a connected subsidiary of the Company under the Listing Rules. However, upon the completion of the Equity Subscription and Capital Injection Agreement, CMIT has ceased to be a subsidiary of the Company since 9 February 2021. The amount of service fees paid and payable by the Group to CMIT in connection with the services for the period between 1 January 2021 to 9 February 2021 was RMB3.5 million (equivalent to approximately HK$4.2 million). (vii) On 9 August 2019, Shenzhen Jinyu Rongtai Investment Development Company Limited ( 深圳金域融泰投資發展有限公司 ) (“ Shenzhen Jinyu ”), an indirect wholly-owned subsidiary of the Company, and SCMPI entered into a property services agreement (the “ 2019 Property Services Agreement ”) for a term of three years commenced on 1 July 2019 and ending on 30 June 2022. Pursuant to the 2019 Property Services Agreement, Shenzhen Jinyu engages SCMPI to provide lease management and operational management services in relation to a property located in Nanhai Yikumeng Industrial Building located in the Guangdong Province (the “ Target Property ”). Shenzhen Jinyu agrees to pay to SCMPI (i) a management fee of 6% of any operational income actually received by Shenzhen Jinyu (including but not limited to rental fees received from the rental of advertisement space and venue space at the Target Property); (ii) a commission fee of 6% of any annual income received by Shenzhen Jinyu from the rental of car parks at the Target Property; and (iii) any expense (including human resources costs) incurred by SCMPI under the 2019 Property Management Services Agreement. The Directors resolved to set the annual caps in respect of the fees payable to SCMPI under the 2019 Property Management Services Agreement for the six months ended 31 December 2019, the year ended 31 December 2020 and the year ended 31 December 2021 as RMB4.4 million (equivalent to approximately HK$5 million), RMB9.2 million (equivalent to approximately HK$10.5 million), and RMB9.6 million (equivalent to approximately HK$10.9 million), respectively. The amount of service fees paid and payable by the Group to SCMPI in connection with the service period in the year ended 31 December 2021 was RMB7.4 million (equivalent to approximately HK$8.9 million). SCMPI is an indirect wholly- owned subsidiary of CMG, and accordingly, a connected person of the Company.