Edgar Filing: JF CHINA REGION FUND INC

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-06686
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JF China Region Fund, Inc.
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(Exact name of registrant as specified in charter)

301 Bellevue Parkway
Wilmington, DE 19809
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(Address of principal executive offices) (Zip code)

Cleary, Gottlieb, Steen & Hamilton
1 Liberty Plaza
New York, NY 10006
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(Name and address of agent for service)

registrant's telephone number, including area code: 800-441-9800
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Date of fiscal year end: December 31
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Date of reporting period: December 31, 2004
------------------

Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.

A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.

ITEM 1. REPORTS TO STOCKHOLDERS.

The Report to Shareholders is attached herewith.

(LOGO) JF CHINA REGION FUND, INC.
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ANNUAL REPORT
DECEMBER 31, 2004

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THIS REPORT, INCLUDING THE FINANCIAL STATEMENTS HEREIN, IS SENT TO THE
STOCKHOLDERS OF THE FUND FOR THEIR INFORMATION. IT IS NOT A PROSPECTUS, CIRCULAR
OR REPRESENTATION INTENDED FOR USE IN THE PURCHASE OR SALE OF SHARES OF THE FUND
OR OF ANY SECURITIES MENTIONED IN THIS REPORT.

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JF CHINA REGION FUND, INC.

CONTENTS
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PAGE
Objectives 1
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Management 1
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Market Information 1
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Highlights 2
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Chairman's Statement 3
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Top Ten Holdings 4
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Investment Portfolio 6
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Statement of Assets and Liabilities 13
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Statement of Operations 14
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Statements of Changes in Net Assets 15
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Financial Highlights 16
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Notes to Financial Statements 17
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Report of Independent Registered Public Accounting Firm 22
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Results of the Annual Stockholders Meeting 23
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Other Information 23
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Fund Management 24
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Dividend Reinvestment and Cash Purchase Plan 25
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Directors and Administration 26
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JF CHINA REGION FUND, INC.

OBJECTIVES
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JF China Region Fund, Inc. (the "Fund") seeks to achieve long-term capital
appreciation through investments primarily in equity securities of companies
with substantial assets in, or revenues derived from, the People's Republic of
China (PRC or China), Hong Kong, Taiwan and Macau--collectively, the China
Region.
The Fund provides investors with an opportunity to participate in the
growing economies of the China Region, especially that of the PRC, although
investments are expected to be predominantly in securities listed on the Stock
Exchange of Hong Kong. Hong Kong enterprises have made substantial investments
in the PRC, in Guangdong Province in particular, where abundant labor and land
are available. Hong Kong is also the largest trading partner of the PRC.
Furthermore, many PRC companies and their Hong Kong-incorporated subsidiaries
have listed their securities on the Stock Exchange of Hong Kong.
The economies of the PRC, Hong Kong, Taiwan and Macau have become
increasingly linked over the past 10 years and are becoming further integrated
now that Hong Kong and Macau have reverted to Chinese sovereignty. Investments
made by the Fund will seek to take advantage of opportunities resulting from
this linkage among the China Region markets.

MANAGEMENT
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JF International Management Inc. ("JFIM") is the investment management
company appointed to advise and manage the Fund's portfolio. JFIM is part of
J.P. Morgan Chase & Co. ("JPMC"), one of the world's premier financial services
institutions. In asset management, JPMC operates globally under the name of
JPMorgan Fleming Asset Management ("JPMFAM"), although in Asia it uses the
sub-brand JF Asset Management. Funds under management for the global asset
management business of JPMFAM were US $791 billion as of December 31, 2004.
Chung Man Wing is the portfolio manager of the Fund. Mr. Chung joined JPMFAM
in late 2000 as head of the Greater China team. Previously, he was chief
investment officer at HSBC Asset Management (Asia).

MARKET INFORMATION
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THE FUND IS LISTED ON THE NEW YORK STOCK EXCHANGE (SYMBOL JFC). THE SHARE PRICE
IS PUBLISHED IN
--------------------------------------------------------------------------------

[ ] The Wall Street Journal (daily)
[ ] The Asian Wall Street Journal (daily)

THE NET ASSET VALUE IS PUBLISHED IN
--------------------------------------------------------------------------------

[ ] The Wall Street Journal under "Closed-End Funds" (every Monday)
[ ] The Asian Wall Street Journal under "Closed-End Funds" (every Monday)

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JF CHINA REGION FUND, INC.

HIGHLIGHTS
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DECEMBER 31, 2004 December 31, 2003
US$ US$
--------------------------------------------------------------------------------
Net Assets $64.5 MILLION $63.9 million
Net Asset Value Per Share $14.06 $13.93

MARKET DATA
Share Price on the
New York Stock Exchange $12.80 $18.08

(Discount)/Premium to Net Asset Value (9.0%) 29.8%

TOTAL RETURN FOR THE PERIOD ENDED DECEMBER 31, 2004
--------------------------------------------------------------------------------
Net Asset Value 0.93%
Share Price -29.20%
JFC Benchmark Index* 14.27%
MSCI Hong Kong Index (Total) 24.98%
BNP Prime Peregrine China Index 2.90%
Taiwan Weighted Index 11.66%

NET ASSET VALUE AND SHARE PRICE VS. BENCHMARK INDEX

EDGAR REPRESENTATION OF DATA USED IN PRINTED GRAPHIC

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July 16, 1992 = 100

Net Asset Value Share Price JFC Benchmark Index*
7/16/92 $100.00 $100.00 $100.00
7/27/92 $99.78 $98.33 $89.81
8/28/92 $100.43 $94.20 $91.11
9/30/92 $100.94 $80.00 $79.15
10/30/92 $108.60 $92.53 $90.31
11/30/92 $111.05 $96.67 $91.95
12/31/92 $109.29 $93.02 $90.21
1/29/93 $110.16 $96.37 $87.65
2/26/93 $117.49 $98.85 $97.55
3/31/93 $120.54 $108.90 $94.28
4/30/93 $125.48 $118.95 $97.84
5/28/93 $129.84 $122.30 $92.05
6/30/93 $122.35 $120.09 $83.13
7/30/93 $120.67 $116.73 $77.96
8/27/93 $124.75 $129.29 $82.27
9/30/93 $128.39 $126.81 $84.74
10/29/93 $147.17 $150.32 $102.63
11/26/93 $156.34 $166.71 $113.90
12/31/93 $188.96 $187.39 $128.98
1/28/94 $175.52 $183.65 $111.34
2/25/94 $158.91 $148.41 $103.16
3/31/94 $136.56 $136.08 $91.08
4/29/94 $132.14 $134.18 $87.30
5/27/94 $136.06 $148.41 $90.89
6/30/94 $123.99 $123.29 $82.84
7/29/94 $130.78 $126.47 $87.48
8/26/94 $130.78 $135.83 $92.18
9/30/94 $132.98 $129.56 $94.14
10/28/94 $132.34 $126.47 $89.14
11/23/94 $124.35 $110.76 $80.63
12/30/94 $115.72 $94.29 $72.23
1/27/95 $101.37 $90.10 $62.02
2/24/95 $108.27 $98.48 $66.92
3/31/95 $109.37 $94.29 $67.13
4/30/95 $105.33 $90.10 $63.43
5/26/95 $113.68 $107.01 $70.35
6/30/95 $111.93 $92.33 $69.32
7/28/95 $116.08 $95.51 $73.64
8/31/95 $108.89 $88.13 $69.66
9/30/95 $112.85 $94.42 $68.82
10/31/95 $110.46 $89.22 $67.02
11/30/95 $104.65 $85.02 $64.06
12/29/95 $103.54 $84.52 $63.34
1/31/96 $112.35 $107.76 $72.64
2/29/96 $113.37 $95.08 $73.99
3/31/96 $110.12 $95.08 $70.65
4/30/96 $111.70 $96.18 $68.52
5/31/96 $112.25 $94.07 $71.64
6/30/96 $111.98 $87.73 $71.47
7/31/96 $110.21 $81.39 $71.69
8/30/96 $110.68 $84.52 $73.69
9/30/96 $112.16 $85.62 $74.73
10/31/96 $113.18 $83.51 $77.45
11/29/96 $125.79 $90.86 $89.15
12/31/96 $132.84 $95.25 $97.43
1/31/97 $135.63 $99.49 $99.27
2/28/97 $138.13 $99.49 $100.73
3/27/97 $133.96 $99.49 $99.65
4/30/97 $148.44 $106.94 $106.53
5/31/97 $159.48 $115.41 $111.06
6/30/97 $170.35 $124.89 $114.45
7/31/97 $178.89 $130.22 $117.43
8/31/97 $187.33 $126.50 $121.24
9/30/97 $167.65 $124.38 $116.19
10/31/97 $124.12 $87.29 $88.50
11/28/97 $107.96 $84.67 $82.92
12/31/97 $110.00 $82.89 $83.73
1/30/98 $85.88 $79.75 $70.48
2/28/98 $114.29 $88.25 $86.61
3/31/98 $107.58 $80.77 $83.66
4/30/98 $98.27 $74.90 $76.62
5/29/98 $83.74 $60.57 $69.04
6/30/98 $72.75 $54.24 $63.53
7/31/98 $57.28 $44.10 $56.17
8/31/98 $51.32 $29.76 $50.16
9/30/98 $60.82 $40.91 $56.88
10/30/98 $70.51 $50.48 $65.12
11/30/98 $72.47 $53.14 $64.68
12/31/98 $69.86 $46.76 $61.44
1/29/99 $63.27 $45.70 $55.92
2/26/99 $63.43 $44.63 $56.22
3/31/99 $69.67 $47.82 $62.49
4/30/99 $82.25 $62.17 $74.33
5/31/99 $76.94 $57.39 $69.97
6/30/99 $90.35 $74.39 $80.74
7/30/99 $84.95 $60.57 $75.80
8/31/99 $88.77 $61.11 $78.44
9/30/99 $84.11 $56.86 $73.92
10/29/99 $87.65 $59.51 $75.69
11/30/99 $99.29 $68.01 $82.85
12/31/99 $110.11 $72.07 $90.38
1/31/00 $108.99 $69.94 $90.33
2/29/00 $113.38 $73.68 $91.87
3/31/00 $118.43 $75.28 $96.89
4/28/00 $100.86 $64.07 $87.24
5/31/00 $94.69 $62.46 $82.27
6/30/00 $98.52 $66.73 $85.48
7/31/00 $102.07 $69.94 $89.73
8/31/00 $103.94 $71.54 $88.73
9/29/00 $95.34 $66.73 $79.73
10/31/00 $87.40 $64.07 $72.78
11/30/00 $83.00 $61.93 $68.48
12/29/00 $87.30 $60.33 $71.12
1/31/01 $95.81 $71.33 $78.24
2/28/01 $91.42 $67.57 $76.15
3/30/01 $84.59 $60.73 $69.80
4/30/01 $86.09 $63.89 $69.03
5/31/01 $87.12 $66.46 $67.29
6/29/01 $84.69 $66.20 $65.30
7/31/01 $78.98 $60.22 $61.21
8/31/01 $73.10 $54.24 $57.47
9/28/01 $66.37 $50.83 $48.34
10/31/01 $71.51 $51.34 $51.10
11/30/01 $76.18 $55.95 $57.64
12/31/01 $76.09 $56.12 $63.41
1/31/02 $75.34 $55.52 $63.09
2/28/02 $75.53 $57.92 $60.84
3/28/02 $81.23 $63.64 $65.43
4/30/02 $80.95 $64.92 $66.68
5/31/02 $81.88 $65.18 $64.55
6/28/02 $76.65 $58.94 $60.36
7/31/02 $73.94 $54.24 $57.39
8/30/02 $70.29 $53.39 $54.89
9/30/02 $65.71 $49.71 $49.30
10/31/02 $68.42 $52.96 $52.07
11/29/02 $70.48 $55.78 $54.34
12/31/02 $69.82 $55.52 $50.92
1/31/03 $77.58 $62.36 $53.73
2/28/03 $77.30 $66.63 $50.72
3/31/03 $73.94 $64.41 $48.90
4/30/03 $73.75 $63.21 $48.38
5/30/03 $82.63 $65.43 $53.24
6/30/03 $86.93 $73.46 $55.68
7/31/03 $96.93 $80.30 $60.86
8/29/03 $104.13 $88.58 $66.88
9/30/03 $106.37 $86.87 $68.73
10/31/03 $120.30 $116.09 $73.75
11/28/03 $119.37 $114.63 $72.11
12/31/03 $130.21 $154.44 $75.70
1/30/04 $134.88 $129.50 $80.89
2/27/04 $143.95 $141.97 $84.25
3/31/04 $135.35 $123.01 $79.74
4/30/04 $115.81 $91.40 $73.82
5/31/04 $118.43 $104.47 $74.32
6/30/04 $115.63 $97.12 $73.49
7/30/04 $115.63 $90.80 $72.08
8/31/04 $117.59 $102.68 $76.05
9/30/04 $121.80 $100.88 $78.02
10/31/04 $121.33 $99.17 $77.35
11/30/04 $128.81 $111.05 $83.91
12/31/04 $131.42 $109.34 $86.50

* JFC Benchmark: MSCI Golden Dragon Index (Total)
Prior to March 2001: 25% Taiwan Weighted Index, 20% BNP Prime Peregrine China
Index, 50% MSCI Hong Kong Index, 5% HSBC
Prior to March 1999: 60% Hong Kong All Ordinaries Index, 30% Credit Lyonnais
Securities Asia All China B Index, 10% Taiwan Weighted
Index
Prior to January 1997: Peregrine Greater China Index
**Commencement of operations
Source: JPMorgan Fleming Asset Management

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JF CHINA REGION FUND, INC.

CHAIRMAN'S STATEMENT
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Dear Fellow Stockholder,

After a strong year in the markets of the Greater China Region in 2003, the
overall performance of the Region during 2004 has been more sedate. The
substantial premium to net asset value at which the Fund's shares traded at the
end of 2003 converted to a discount of -9.0% at the end of 2004. This change
meant that, even though the net asset value rose by a moderate amount over the
year, the share price fell by 29.20% over the same period. This contrasted with
a rise in the Fund's benchmark index (The MSCI Golden Dragon Index) of 14.27%.
Overall, this is a disappointing result in the light of last year's success.

Chinese shares ended the year flat, as the correction in October was offset
by renewed speculation about a Renminbi revaluation. On the other hand the
Renminbi appreciation hopes brought improved liquidity flows to a possible Hong
Kong and kept interest rates at a record discount to US rates. The Hong Kong and
Taiwan markets rallied at the end of the year, and the New Taiwanese dollar
appreciated 6.5% against the US dollar in the final quarter.

During the year your Board have kept a close eye on the market volatility
and the Fund's absolute level of discount, and we will continue to do this going
forward.

Respectfully submitted,

/s/ RT. HON. THE EARL OF CROMER
-------------------------------
The Rt. Hon. The Earl of Cromer
Chairman

February 18, 2005

For more information refer to the website www.jpmorganfleming.com/jfchinaregion

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JF CHINA REGION FUND, INC.

TOP TEN HOLDINGS
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AT DECEMBER 31, 2004
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% of Net
Assets
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CHEUNG KONG (HOLDINGS) 5.0

Cheung Kong (Holdings) Limited, through its subsidiaries,
develops and invests in real estate. The Company also provides real
estate agency and management services, and invests in securities.

TAIWAN SEMICONDUCTOR MANUFACTURING 4.9

Taiwan Semiconductor Manufacturing Company Limited manufactures
and markets integrated circuits. The Company provides the following
services: wafer manufacturing, wafer probing, assembly and testing,
mask production and design services. The Company's integrated
circuits are used in computer, communication, consumer electronics,
automotive, and industrial equipment industries.

CHINA MOBILE (HONG KONG) 4.8

China Mobile (Hong Kong) Limited, through its subsidiaries,
provides cellular telecommunication services in the People's
Republic of China.

SWIRE PACIFIC 'A' 2.6

Swire Pacific Limited, through its subsidiaries, operates real
estate, aviation, beverage, industrial, marine services, trading and
industrial businesses.

WEICHAI POWER 'H' 2.6

Weichai Power Co., Limited manufactures high-speed heavy-duty
diesel engines. The Company's products are used in heavy-duty
vehicles, wheel-loaders, bulldozers and road-rollers.

CHINA TELECOM 'H' 2.2

China Telecom Corporation Limited, through its subsidiaries,
provides wire line telephone, data and internet, as well as leased
line services in China.

HYSAN DEVELOPMENT 2.0

Hysan Development Company Limited, through its subsidiaries,
invests in real estate. The Company's properties include commercial
rental and luxury residential buildings in Hong Kong.

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JF CHINA REGION FUND, INC.

TOP TEN HOLDINGS (CONTINUED)
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AT DECEMBER 31, 2004
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% of Net
Assets
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HANG LUNG PROPERTIES 2.0

Hang Lung Properties Limited invests in, develops and manages
properties. The Company also manages parking lots.

ANGANG NEW STEEL 'H' 1.9

Angang New Steel Company Limited produces steel products which
include cold rolled sheets, steel rail, pipe billets, wire rods,
thick plates and other steel products.

HANG SENG BANK 1.9

Hang Seng Bank Limited and its subsidiaries provide banking and
related financial services.
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TOTAL TOP TEN HOLDINGS 29.9

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JF CHINA REGION FUND, INC.

INVESTMENT PORTFOLIO
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AT DECEMBER 31, 2004
-------------------------------------------------------------------------------
Market
Holdings Value
Description (in shares) (in US$)
-------------------------------------------------------------------------------
INVESTMENTS IN COMMON STOCKS (UNLESS OTHERWISE NOTED)
-------------------------------------------------------------------------------

CHINA (17.0%)
-------------------------------------------------------------------------------

AIR FREIGHT & COURIERS (1.0%)
Sinotrans 'H' 2,161,000 632,501
-------------------------------------------------------------------------------

AUTO COMPONENTS (0.4%)
Weifu High-Technology 'B' 344,000 288,114
-------------------------------------------------------------------------------

AUTOMOBILES (1.2%)
Chongqing Changan Automobile 'B' 1,684,500 769,351
-------------------------------------------------------------------------------

COMMERCIAL SERVICES & SUPPLIES (0.2%)
* CCID Consulting 'H' 4,200,000 108,070
-------------------------------------------------------------------------------

COMPUTERS & PERIPHERALS (0.5%)
Lenovo Group 1,072,000 320,659
-------------------------------------------------------------------------------

DIVERSIFIED TELECOMMUNICATION SERVICES (2.2%)
China Telecom 'H' 3,784,000 1,387,463
-------------------------------------------------------------------------------

INSURANCE (0.3%)
* PICC Property and Casualty 'H' 556,000 193,136
-------------------------------------------------------------------------------

MACHINERY (3.6%)
Shanghai Zhenhua Port Machinery 'B' 837,000 650,349
* Weichai Power 'H' 606,000 1,680,139

-------------------------------------------------------------------------------
2,330,488
-------------------------------------------------------------------------------

METALS & MINING (1.9%)
Angang New Steel 'H' 2,464,000 1,252,169
-------------------------------------------------------------------------------

OIL & GAS (3.9%)
China Petroleum and Chemical 'H' 1,566,000 644,714
PetroChina 'H' 2,298,000 1,226,940
Sinopec Zhenhai Refining and Chemical 'H' 600,000 621,402
-------------------------------------------------------------------------------
2,493,056
-------------------------------------------------------------------------------

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JF CHINA REGION FUND, INC.

INVESTMENT PORTFOLIO (CONTINUED)
-------------------------------------------------------------------------------
AT DECEMBER 31, 2004
-------------------------------------------------------------------------------
Market
Holdings Value
Description (in shares) (in US$)
-------------------------------------------------------------------------------

PAPER & FOREST PRODUCTS (0.3%)
* Shandong Chenming Paper Holdings 'B' 354,300 225,177
-------------------------------------------------------------------------------

WIRELESS TELECOMMUNICATION SERVICES (1.5%)
China Unicom 1,248,000 987,450
-------------------------------------------------------------------------------

TOTAL CHINA 10,987,634
-------------------------------------------------------------------------------

HONG KONG (55.3%)
-------------------------------------------------------------------------------

AIRLINES (2.1%)
Air China 1,954,000 754,173
China Southern Airlines Company, Group 'H' 1,506,000 595,793
-------------------------------------------------------------------------------
1,349,966
-------------------------------------------------------------------------------

COMMERCIAL BANKS (4.6%)
BOC Hong Kong (Holdings) 339,000 647,667
CITIC International Financial Holdings 1,095,000 486,025
Dah Sing Financial Group 80,000 620,115
Hang Seng Bank 89,300 1,240,796
-------------------------------------------------------------------------------
2,994,603
-------------------------------------------------------------------------------

COMPUTERS & PERIPHERALS (1.0%)
TPV Technology 1,068,000 638,924
-------------------------------------------------------------------------------

CONSTRUCTION & ENGINEERING (0.8%)
* COSCO International Holdings 2,894,000 513,810
-------------------------------------------------------------------------------

CONTAINERS & PACKAGING (1.9%)
Hung Hing Printing Group 418,000 311,910
Singamas Container Holdings 1,654,000 909,698
-------------------------------------------------------------------------------
1,221,608
-------------------------------------------------------------------------------

DISTRIBUTORS (1.3%)
China Resources Enterprises 544,000 850,355
-------------------------------------------------------------------------------

DIVERSIFIED TELECOMMUNICATION SERVICES (1.1%)
China Netcom Group Corporation (Hong Kong) 525,000 712,586
-------------------------------------------------------------------------------

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JF CHINA REGION FUND, INC.

ELECTRIC UTILITIES (2.6%)
China Resources Power Holdings 602,000 327,226
Foshan Electrical & Lighting B 168,100 192,263
Hong Kong Electric Holdings 256,500 1,171,497
-------------------------------------------------------------------------------
1,690,986
-------------------------------------------------------------------------------

ELECTRONIC EQUIPMENT & INSTRUMENTS (0.7%)
Digital China Holdings 1,704,000 465,858
-------------------------------------------------------------------------------

FOOD PRODUCTS (0.0%)
* Global Bio-chem Technology Group Warrants --
expire 05/31/2007 150,250 7,152
-------------------------------------------------------------------------------

HEALTHCARE EQUIPMENT & SUPPLIES (0.6%)
Hengan International Group 564,000 370,062
-------------------------------------------------------------------------------

HOTELS, RESTAURANTS & LEISURE (1.1%)
* Macau Success 3,400,000 686,758
-------------------------------------------------------------------------------

HOUSEHOLD DURABLES (1.7%)
Dickson Concepts (International) 334,500 451,867
Skyworth Digital Holdings++ 3,892,456 681,064
-------------------------------------------------------------------------------
1,132,931
-------------------------------------------------------------------------------

INDUSTRIAL CONGLOMERATES (1.7%)
Hutchison Whampoa 118,000 1,104,435
-------------------------------------------------------------------------------

METALS & MINING (1.5%)
Zijin Mining Group 2,100,000 952,366
-------------------------------------------------------------------------------

MISCELLANEOUS (0.0%)
* Health Asia MediCentres Beijing++ 1,000,000 0
-------------------------------------------------------------------------------

MULTILINE RETAIL (1.8%)
Aeon Stores (Hong Kong) 760,000 826,220
Lifestyle International Holdings 212,000 315,023
-------------------------------------------------------------------------------
1,141,243
-------------------------------------------------------------------------------

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JF CHINA REGION FUND, INC.

OIL & GAS (1.7%)
CNOOC 2,022,000 1,086,083
-------------------------------------------------------------------------------

REAL ESTATE (18.8%)
Cheung Kong (Holdings) 320,000 3,190,634
Far East Consortium International 1,314,000 566,325
Hang Lung Properties 832,000 1,284,488
Henderson Investments 218,000 318,330
Henderson Land 61,000 317,056
Hysan Development Company 622,419 1,309,260
New World Development Company 886,000 991,695
Sung Hung Kai Properties 116,000 1,160,336
Swire Pacific 'A' 203,000 1,697,597
Wharf (Holdings) 180,000 629,893
Wheelock and Company 387,000 637,304
-------------------------------------------------------------------------------
12,102,918
-------------------------------------------------------------------------------

TEXTILES, APPAREL & LUXURY GOODS (1.1%)
Giordano International 1,098,000 688,656
-------------------------------------------------------------------------------

TRANSPORTATION INFRASTRUCTURE (4.4%)
China Merchants Holdings International 576,000 1,085,639
Cosco Pacific 352,000 729,111
GZI Transport 1,572,000 465,164
Hopewell Holdings 207,000 531,298
-------------------------------------------------------------------------------
2,811,212
-------------------------------------------------------------------------------

WIRELESS TELECOMMUNICATION SERVICES (4.8%)
China Mobile (Hong Kong) 918,500 3,113,760
-------------------------------------------------------------------------------

TOTAL HONG KONG 35,636,272
-------------------------------------------------------------------------------

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JF CHINA REGION FUND, INC.

SINGAPORE (0.8%)
-------------------------------------------------------------------------------

CONTAINERS & PACKAGING (0.8%)
Full Apex Holdings 2,000,000 496,202
-------------------------------------------------------------------------------

TOTAL SINGAPORE 496,202
-------------------------------------------------------------------------------

SOUTH KOREA (1.0%)
-------------------------------------------------------------------------------

MARINE (1.0%)
Hanjin Shipping 29,300 679,289
-------------------------------------------------------------------------------

TOTAL SOUTH KOREA 679,289
-------------------------------------------------------------------------------

TAIWAN (22.7%)
-------------------------------------------------------------------------------

AIRLINES (0.0%)
EVA Airways 727 357
-------------------------------------------------------------------------------

COMMERCIAL BANKS (1.7%)
Chinatrust Financial Holding 826 985
* Cosmos Bank Taiwan 1,095,000 530,450
Polaris Securities Company 356,000 199,333
Taishin Financial Holdings Company 347,000 325,279
Yuanta Securities Company 37,974 28,788
-------------------------------------------------------------------------------
1,084,835
-------------------------------------------------------------------------------

COMPUTERS & PERIPHERALS (0.8%)
Asustek Computer Incorporated 195,000 518,323
-------------------------------------------------------------------------------

DISTRIBUTORS (0.5%)
Acer Incorporated 198,000 326,990
-------------------------------------------------------------------------------

-- 10 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

ELECTRONIC EQUIPMENT & INSTRUMENTS (5 9%)
Au Optronics Corporation 833,000 1,202,727
Chi Mei Optoelectronics Corporation 235,000 316,389
* Hannstar Display Corporation 1,029,000 339,871
Hon Hai Precision Industry 237,000 1,095,911
Phoenix Precision Technology Corporation 901,000 530,000
Synnex Technology International 222,000 327,518
-------------------------------------------------------------------------------
3,812,416
-------------------------------------------------------------------------------

HOUSEHOLD DURABLES (0.2%)
Nien Made Enterprise 60,000 94,369
-------------------------------------------------------------------------------

INSURANCE (0.8%)
* Cathay Financial Holding GDR 26,618 539,014
-------------------------------------------------------------------------------

LEISURE EQUIPMENT & PRODUCTS (0.0%)
Premier Image Technology 650 640
-------------------------------------------------------------------------------

METALS & MINING (0.5%)
China Steel 298,000 335,590
-------------------------------------------------------------------------------

PAPER & FOREST PRODUCTS (0.7%)
Chung Hwa Pulp 414,500 217,746
Yuen Foong Yu Manufacturing Company 406,000 223,498
-------------------------------------------------------------------------------
441,244
-------------------------------------------------------------------------------

SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT (9.2%)
Advanced Semiconductor Engineering 437,000 329,915
Chipbond Technology Corporation 1,017,000 1,020,519
Novatek Microelectronics Corporation 288,000 1,005,599
Taiwan Semiconductor Manufacturing 2,003,184 3,182,158
* United Microelectronics 320 206
* Windbond Electronics 1,001,000 401,471
-------------------------------------------------------------------------------
5,939,868
-------------------------------------------------------------------------------

SOFTWARE (0.6%)
Soft-World International 206,778 393,523
-------------------------------------------------------------------------------

-- 11 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

TEXTILES, APPAREL & LUXURY GOODS (1.3%)
Far East Department Stores 1,406,000 804,945
Pou Chen 899 797
-------------------------------------------------------------------------------
805,742
-------------------------------------------------------------------------------

WIRELESS TELECOMMUNICATION SERVICES (0.5%)
Far EasTone Telecommunications 900 1,090
Taiwan Cellular 293,000 327,194
-------------------------------------------------------------------------------
328,284
-------------------------------------------------------------------------------

TOTAL TAIWAN 14,621,195
-------------------------------------------------------------------------------

TOTAL INVESTMENTS IN COMMON STOCKS
(96.8% of Net Assets) (Cost $56,500,562) 62,420,592
===============================================================================

Other assets in excess of liabilities (3.2% of Net Assets) 2,067,379
===============================================================================

NET ASSETS (100.0%) 64,487,971
===============================================================================

Aggregate cost for Federal income tax purposes is $56,594,751.
The aggregate unrealized gain for all securities is as follows:

Excess of market value over cost 7,188,633
Excess of cost over market value (1,362,792)
-------------------------------------------------------------------------------

Net unrealized gain 5,825,841
===============================================================================

B -- Chinese security traded on Shenzhen Stock Exchange or Shanghai Stock
Exchange.
H -- Chinese security traded on Hong Kong Stock Exchange.
GDR -- Global Depository Receipts
* Non-income producing security.
++ At fair value as determined under the supervision of the Board of Directors.

See accompanying notes to financial statements.

-- 12 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

STATEMENT OF ASSETS AND LIABILITIES
--------------------------------------------------------------------------------
AT DECEMBER 31, 2004
--------------------------------------------------------------------------------
(in US$)
--------------------------------------------------------------------------------
ASSETS
--------------------------------------------------------------------------------
Investments at value (cost $56,500,562) 62,420,592
Cash (including foreign currencies with a cost of $1,369,598
and value of $1,383,860) 1,720,212
Receivable for securities sold 1,568,879
Dividend receivable 30,187
Prepaid expenses 55,125
--------------------------------------------------------------------------------
TOTAL ASSETS 65,794,995
--------------------------------------------------------------------------------

LIABILITIES
--------------------------------------------------------------------------------
Payable for securities purchased 843,663
Due to Investment Advisor 155,151
Accrued expenses payable 308,210
--------------------------------------------------------------------------------
TOTAL LIABILITIES 1,307,024
--------------------------------------------------------------------------------
NET ASSETS 64,487,971
================================================================================

NET ASSETS CONSIST OF:
Common stock, $0.01 par value
(100,000,000 shares authorized;
4,585,160 shares issued and outstanding) 45,852
Paid-in capital 96,142,005
Undistributed net investment income 266,945
Accumulated realized loss on investments
and foreign currency transactions (37,901,947)
Accumulated net unrealized appreciation on investments,
and foreign currency holdings, and other assets
and liabilities denominated in foreign currencies 5,935,116

--------------------------------------------------------------------------------
NET ASSETS 64,487,971
================================================================================
NET ASSET VALUE PER SHARE ($64,487,971 / 4,585,160) 14.06
================================================================================

See accompanying notes to financial statements.

-- 13 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

STATEMENT OF OPERATIONS
--------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31, 2004
--------------------------------------------------------------------------------
(in US$)
--------------------------------------------------------------------------------
INVESTMENT INCOME
--------------------------------------------------------------------------------
Dividends (Net of foreign withholding tax of $98,049) 1,539,709
Interest (Net of foreign withholding tax of $250) 17,097
--------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME 1,556,806
--------------------------------------------------------------------------------

EXPENSES
--------------------------------------------------------------------------------
Investment advisory fees 614,384
Administration and accounting fees 138,000
Legal fees 129,749
Directors' fees and expenses 134,614
Custodian fees 119,700
Shareholder service fees 63,835
Insurance 52,807
Shareholder report and expenses 33,499
Audit fees 37,999
NYSE listing fee 25,000
Other expenses 15,001
--------------------------------------------------------------------------------
TOTAL EXPENSES 1,364,588
--------------------------------------------------------------------------------

NET INVESTMENT INCOME 192,218
================================================================================

REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS, FOREIGN CURRENCY
HOLDINGS AND OTHER ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES
--------------------------------------------------------------------------------
NET REALIZED GAIN
Investments 13,640,006
Foreign currency transactions 83,708
NET CHANGE IN UNREALIZED APPRECIATION/(DEPRECIATION)
Investments and foreign currency holdings and
other assets and liabilities denominated
in foreign currencies (13,310,596)
--------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS,
FOREIGN CURRENCY HOLDINGS AND OTHER ASSETS
AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES 413,118
--------------------------------------------------------------------------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 605,336
================================================================================

See accompanying notes to financial statements.

-- 14 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------------------------------
Year Ended Year Ended
December 31, 2004 December 31, 2003
(in US$) (in US$)
--------------------------------------------------------------------------------------------------------

INCREASE (DECREASE) IN NET ASSETS
Operations
Net investment income (loss) 192,218 (89,574)
Net realized gain on investment transactions 13,640,006 11,397,110
Net realized gain on foreign currency transactions 83,708 12,285
Net change in unrealized appreciation (depreciation)
on investments, foreign currency holdings and
other assets and liabilities denominated in
foreign currencies (13,310,596) 18,324,290
--------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 605,336 29,644,111
--------------------------------------------------------------------------------------------------------

CAPITAL SHARES REPURCHASED -- (10,191)
========================================================================================================
TOTAL INCREASE IN NET ASSETS 605,336 29,633,920
Net Assets:
Beginning of year 63,882,635 34,248,715
--------------------------------------------------------------------------------------------------------
End of year 64,487,971 63,882,635
========================================================================================================

See accompanying notes to financial statements.

-- 15 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------------------------------------------
For the For the For the For the For the
Year Ended Year Ended Year Ended Year Ended Year Ended
December 31, December 31, December 31, December 31, December 31,
2004 2003 2002 2001 2000
(in US$) (in US$) (in US$) (in US$) (in US$)
--------------------------------------------------------------------------------------------------------------------

FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD:
--------------------------------------------------------------------------------------------------------------------
Net asset value,
beginning of year 13.93 7.47 8.14 9.34 11.78
====================================================================================================================
Net investment income
(loss) 0.04 (0.02) (0.04) (0.11) (0.06)
Net realized and
unrealized gain (loss)
on investment and
foreign currency-
related transactions 0.09 6.48 (0.66) (1.31) (2.73)
--------------------------------------------------------------------------------------------------------------------
Total from investment
operations 0.13 6.46 (0.70) (1.42) (2.79)
====================================================================================================================
Dilutive Effect of Capital
shares repurchased -- --* 0.03 0.22 0.35
====================================================================================================================
NET ASSET VALUE, END OF
YEAR 14.06 13.93 7.47 8.14 9.34
====================================================================================================================
Market value, end of
year 12.80 18.08 6.50 6.57 7.06
====================================================================================================================
TOTAL INVESTMENT RETURN
Per share market value (29.2%) 178.2% (1.1%) (6.9%) (16.3%)
Per share net asset
value 0.9% 86.5% (8.2%) (12.8%) (20.7%)

RATIOS/SUPPLEMENTAL DATA
Net assets, end of year 64,487,971 63,882,635 34,248,715 38,169,881 56,150,319
Ratios of total expenses
to average net assets 2.22% 2.54% 2.62% 3.51%+ 2.02%
Ratios of net investment
income (loss) to
average net assets 0.31% (0.19%) (0.44%) (1.25%) (0.36%)
Portfolio turnover rate 168.6% 162.5% 245.0% 212.1% 94.8%
Number of shares
outstanding at end of
year (in thousands) 4,585 4,585 4,587 4,689 6,012

* Less than $0.01 per share.
+ The ratio of total expenses to average net assets for the year ended December 31, 2001 is higher than that of
previous years as a result of the expenses incurred in relation to a tender offer and share repurchases that
decreased the size of the Fund following similar actions in the previous year.

See accompanying notes to financial statements.

-- 16 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

DECEMBER 31, 2004
--------------------------------------------------------------------------------

1. ORGANIZATION AND CAPITAL

JF China Region Fund, Inc. (the "Fund") was incorporated in the State of
Maryland on May 22, 1992, and is registered as a non-diversified,
closed-end management investment company under the Investment Company Act
of 1940. The Fund commenced operations on July 16, 1992.

2. SIGNIFICANT ACCOUNTING POLICIES

The following significant accounting policies, which are in conformity
with accounting principles generally accepted in the United States of
America for investment companies, are consistently followed by the Fund in
the preparation of its financial statements.

The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America ("GAAP")
requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements and the
reported amounts of increases and decreases in net assets from operations
during the reported period. Actual results could differ from these
estimates.

i) SECURITY VALUATION

All securities for which market quotations are readily available are
valued at the last sales price prior to the time of determination, or,
if no sales price is available at that time, at the mean between the
last current bid and asked prices. Securities that are traded
over-the-counter are valued, if bid and asked quotations are
available, at the mean between the current bid and asked prices. All
other securities and assets are valued at fair value as determined in
good faith by the Board of Directors. In valuing the Fund's assets,
quotations of foreign securities in a foreign currency are translated
to U.S. dollar equivalents at the exchange rate in effect on the
valuation date.

ii) FOREIGN CURRENCY TRANSLATION

The books and records of the Fund are maintained in United States
dollars. Foreign currency amounts are translated into U.S. dollars at
the mid-market price of such currencies against U.S. dollars as
follows:

o investments, other assets, and liabilities at the prevailing
rates of exchange on the valuation date;

o investment transactions and investment income at the prevailing
rates of exchange on the dates of such transactions.

Although the net assets of the Fund are presented at the foreign
exchange rates and market values at the close of the period, the Fund
does not isolate that portion of the results of operations arising as
a result of changes in the foreign exchange rates from the
fluctuations arising from changes in the market prices of the
securities held at period-end. Similarly, the Fund does not isolate
the effect of changes in foreign exchange rates from the fluctuations
arising from changes in the market prices of securities sold during
the period. Accordingly,

-- 17 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------

realized and unrealized foreign currency gains (losses) are included
in the reported net realized and unrealized gains (losses) on
investments. Unrealized currency gains (losses) resulting from valuing
foreign currency denominated assets and liabilities at period-end
exchange rates are reflected as a component of accumulated net
unrealized gain (loss) on investments, foreign currency holdings, and
other assets and liabilities denominated in foreign currencies.

iii) DISTRIBUTION OF INCOME AND GAINS

The Fund intends to distribute to stockholders, at least annually,
substantially all of its net investment income and expects to
distribute annually any net long-term capital gains in excess of net
short-term capital losses. An additional distribution may be made to
the extent necessary to avoid the payment of a 4% federal excise tax.

Income and capital gain distributions are determined in accordance
with federal income tax regulations and may differ from those
determined in accordance with generally accepted accounting
principles.

vi) OTHER

Security transactions are accounted for on trade date. Realized gains
and losses on the sale of investment securities are determined on the
identified cost basis. Interest income is recognized on the accrual
basis. Dividend income and distributions to shareholders are recorded
on the ex-dividend date.

3. INVESTMENT TRANSACTIONS

Consistent with its investment objective, the Fund engages in the
following transactions practices. The investment objective, policies,
program, and risk factors of the Fund are described more fully in the
Fund's Prospectus.

During the year ended December 31, 2004, the Fund made purchases of
$99,238,314 and sales of $99,650,333 of investment securities other than
short-term investments. There were no purchases or sales of U.S.
government securities.

4. RELATED PARTY AND OTHER SERVICE PROVIDER TRANSACTIONS

i) JF International Management Inc. (formerly Jardine Fleming
International Management Inc.) (the "Adviser"), an indirect
wholly-owned subsidiary of J.P. Morgan Chase & Co., provides
investment advisory services to the Fund under the terms of an
investment advisory agreement. The Advisor is paid a fee, computed
weekly and payable monthly, at the annual rate of 1.00% of the Fund's
weekly net assets.

ii) During the year ended December 31, 2004, the Fund paid $56,758 in
brokerage commissions to J.P. Morgan Chase Group companies and
affiliated brokers/dealers.

-- 18 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------

iii) OTHER SERVICE PROVIDERS

PFPC Inc. (the "Administrator") provides administrative and accounting
services to the Fund under an Administrative and Accounting Services
Agreement. The Administrator receives a fee, payable monthly, at an
annual rate of 0.135% of the first $100 million, 0.095% of the next
$50 million, 0.08% of the next $50 million and 0.065% of the excess
over $200 million of the Fund's average weekly net assets, subject to
a minimum annual fee of $138,000, plus reimbursement for certain
out-of-pocket expenses.

5. CAPITAL SHARE TRANSACTIONS

On September 9, 2004 the Fund's Board renewed an authority for the Fund to
purchase shares of its common stock from Fund stockholders, as described
below. When shares trade at a discount to net asset value, any purchase of
shares by the Fund has the effect of increasing the net asset value per
share of the Fund's remaining shares outstanding. All shares purchased by
the Fund are thereafter considered authorized and unissued.

i) SHARE REPURCHASE PROGRAM

The Fund was authorized to repurchase up to 460,761 shares (10% of its
issued and outstanding shares) in the open market through July 22,
2003. On July 23, 2003, the Fund's Board of Directors approved a new
10% share repurchase program which authorized the Fund to repurchase
up to 458,516 shares in the open market during 2003 and 2004. The
Fund's Board of Directors extended the share repurchase program
through September 9, 2005.

The Fund is authorized to repurchase up to 458,516 shares (10% of its
issued and outstanding shares) in the open market through September 9,
2005. Repurchases can be made only when the Fund's shares are trading
at less than net asset value and at such times and amounts as it is
believed to be in the best interest of the Fund's stockholders.

During the year ended December 31, 2003, the Fund paid $10,191 to
repurchase 1,550 shares at a per-share weighted average discount to
net asset value of 13.07%.

During the year ended December 31, 2004, the Fund did not participate
in the share repurchase program.

6. RISKS AND UNCERTAINTIES

i) FOREIGN TRANSACTIONS

Foreign security and currency transactions may involve certain
considerations and risks not typically associated with those of U.S.
dollar denominated transactions as a result of, among other factors,
the level of governmental supervision and regulation of foreign
securities markets and the possibility of political or economic
instability.

-- 19 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------

ii) OTHER

In the normal course of business, the Fund may enter into contracts
that provide general indemnifications. The maximum exposure under
these arrangements is dependent on future claims that may be made
against the Fund and, therefore, cannot be estimated; however, based
on experience, the risk of any loss from such claims is considered
remote.

7. TAX STATUS

i) U.S. FEDERAL INCOME TAXES

No provision for federal income taxes is required since the Fund
intends to continue to qualify as a regulated investment company under
subchapter M of the Internal Revenue Code and distribute substantially
all of its taxable income.

At December 31, 2004, the components of net assets (excluding paid-in
capital) on a tax basis were as follows:

Tax basis Ordinary Income $ 266,945
------------
Tax basis capital loss carryforward ............. $(37,807,758)
Plus/Less:cumulative timing differences--
wash sales .................................... (94,189)
------------
Accumulated capital loss ........................................ (37,901,947)
------------
Book unrealized foreign exchange gain ........................... 824
------------
Book unrealized appreciation on foreign currencies .............. 14,262
------------
Tax unrealized appreciation ..................... $ 5,825,841
Plus/Less:cumulative timing differences--
wash sales .................................... 94,189
------------
Unrealized appreciation ......................................... 5,920,030
------------
Net assets (excluding paid-in capital) .......................... $(31,699,886)
============

The difference between book and tax basis unrealized appreciation is primarily
attributable to wash sales. The cumulative timing difference for the capital loss
carryover is due to wash sales.

Net Asset Value ................................................. $ 64,487,971
Paid-in Capital ................................................. (96,187,857)
------------
Net assets (excluding paid-in capital) .......................... $(31,699,886)
============

-- 20 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
--------------------------------------------------------------------------------

As of December 31, 2004, the Fund had capital loss carryforwards for
federal income tax purposes of $37,807,758, of which $18,740,960
expires in 2005, $11,676,567 expires in 2006, $3,780,058 expires in
2008 and $3,610,173 expires in 2009. The Fund intends to retain gains
realized in future periods that may be offset by available capital
loss carryforward.

During the year ended December 31, 2004, the Fund reclassified $83,708
from accumulated net realized loss on investments to accumulated net
investment income as a result of permanent book and tax differences
relating to realized foreign currency gains. Net assets were not
affected by the reclassifications.

-- 21 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
--------------------------------------------------------------------------------

To the Board of Directors and Shareholders of
JF China Region Fund, Inc.

In our opinion, the accompanying statement of assets and liabilities, including
the investment portfolio, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of JF China Region Fund, Inc. (the
"Fund") at December 31, 2004, the results of its operations for the year then
ended, the changes in its net assets for each of the two years in the period
then ended and the financial highlights for each of the five years in the period
then ended, in conformity with accounting principles generally accepted in the
United States of America. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of the
Fund's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at
December 31, 2004 by correspondence with the custodian, provide a reasonable
basis for our opinion.

PricewaterhouseCoopers LLP

Philadelphia, Pennsylvania
February 11, 2005

-- 22 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

RESULTS OF THE ANNUAL STOCKHOLDERS MEETING (UNAUDITED)
--------------------------------------------------------------------------------

The Fund held its annual stockholders meeting on May 13, 2004. At this meeting,
stockholders elected the following nominees to the Fund's Board of Directors.
Stockholders also voted on a proposal to change the Fund's fundamental policies
to permit the Fund to borrow up to 20% of the Fund's net assets (not including
the amount borrowed) for investment purposes, which was not approved.

I) ELECTION OF DIRECTORS

NOMINEE VOTES FOR VOTES ABSTAINED NON-VOTING SHARES TOTAL VOTING SHARES
------- --------- --------------- ----------------- -------------------

A. Douglas Eu 3,126,637 97,542 1,360,981 4,585,160
Simon J. Crinage 3,126,534 97,645 1,360,981 4,585,160

II) PROPOSAL TO APPROVE A CHANGE IN THE FUND'S FUNDAMENTAL POLICIES TO
PERMIT THE FUND TO BORROW UP TO 20% OF THE FUND'S NET ASSETS (NOT
INCLUDING THE AMOUNT BORROWED) FOR INVESTMENT PURPOSES

VOTES FOR VOTES AGAINST VOTES ABSTAINED NON-VOTING SHARES TOTAL VOTING SHARES
--------- ------------- --------------- ----------------- -------------------

1,034,859 386,219 241,099 2,922,983 4,585,160

OTHER INFORMATION
--------------------------------------------------------------------------------

On July 15, 2002, the Board of Directors amended the Fund's investment policy to
require that, under normal circumstances, at least 80% of the Fund's net assets,
plus the amount of any borrowings for investment purposes, be invested in equity
securities issued by China Region companies or China Region associated companies
(the policy previously had a 65% requirement).

INFORMATION ABOUT PORTFOLIO HOLDINGS
The Fund files its complete schedule of portfolio holdings with the U.S.
Securities and Exchange Commission (the "Commission") for the first and third
quarters of each fiscal year on Form N-Q. The Fund's Forms N-Q are available on
the Commission's website at http://www.sec.gov and may be reviewed and copied at
the Commission's Public Reference Room in Washington, DC. Information on the
operation of the Public Reference Room may be obtained by calling
1-800-SEC-0330.

PROXY VOTING POLICIES AND PROCEDURES AND PROXY VOTING RECORD
A description of the policies and procedures that the Fund uses to determine how
to vote proxies relating to portfolio securities is available without charge,
upon request, by calling 202-942-8088, and on the Commission's website at
http://www.sec.gov.

Information regarding how the Fund voted proxies relating to portfolio
securities during the most recent 12-month period ended June 30 is available
without charge, upon request, by calling 202-942-8088, and on the Commission's
website at http://www.sec.gov.

CERTIFICATIONS
Simon J. Crinage, as the Fund's President, has certified to the New York Stock
Exchange that, as of May 26, 2004, he was not aware of any violation by the Fund
of applicable NYSE corporate governance listing standards. The Fund's reports to
the Commission on Forms N-CSR and N-CSRS contain certifications by the Fund's
principal executive officer and principal financial officer that relate to the
Fund's disclosure in such reports and that are required by rule 30a-2(a) under
the 1940 Act.

-- 23 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

FUND MANAGEMENT
--------------------------------------------------------------------------------

Information pertaining to the Directors and officers of the Fund is set forth
below.

------------------------------------------------------------------------------------------------------------------------------------
NUMBER OF
TERM OF PORTFOLIOS IN OTHER
OFFICE AND FUND COMPLEX TRUSTEESHIPS/
NAME, (DOB), ADDRESS AND LENGTH OF TIME PRINCIPAL OCCUPATION(S) OVERSEEN BY DIRECTORSHIPS
POSITION(S) WITH FUND SERVED 1 DURING PAST 5 YEARS DIRECTOR 2 HELD BY DIRECTOR
------------------------------------------------------------------------------------------------------------------------------------
DISINTERESTED DIRECTORS
------------------------------------------------------------------------------------------------------------------------------------

The Rt. Hon. The Earl of Cromer Since 1994 Chairman of the Board of the Fund; 1 Director of Schroder Asia
(June 3, 1946) Chief Executive Officer of Cromer Pacific Fund Limited,
Finsbury Dials Associates Limited (family business); Business Link Somerset
20 Finsbury Street Chairman of Lloyd George-Standard Limited and Western
London, EC2Y 9AQ Chartered China Fund Limited and Provident Association;
United Kingdom Philippine Discovery Investment Company former Director of
Chairman and Director, Class I Limited (consulting). Inchcape Pacific Limited,
A1HQ.com Inc. and Korea
Asia Fund Limited.
------------------------------------------------------------------------------------------------------------------------------------
Alexander Reid Hamilton Since 1994 Director of Citic Pacific Limited 1 See Principal Occupation
(October 4, 1941) (infrastructure), Cosco Pacific Limited
P.O. Box 12343 (container shipping), Espirit Holdings
General Post Office Limited (clothing retail), Shangri-La
Hong Kong Asia Limited (hotels) and Octopus Cards
Director, Class I Limited (financial services).
------------------------------------------------------------------------------------------------------------------------------------
Julian M. I. Reid Since 1998 Chief Executive Officer of 3a Asset 1 Director of Korea Fund,
(August 7, 1944) Management Limited; Director and Inc. and 3a Global Growth
10 Frere Felix de Valois Street Chairman of Morgan's Walk Properties Fund Limited.
Port Louis, Mauritius Limited.
Director, Class III
------------------------------------------------------------------------------------------------------------------------------------
INTERESTED DIRECTORS
------------------------------------------------------------------------------------------------------------------------------------
A. Douglas Eu Since 1997 Treasurer of the Fund; Director, Chief 1 None
(August 27, 1961) Operations Officer and Secretary of the
21st Floor, Chater House Investment Adviser; Chief Executive
8 Connaught Road Officer of JF Funds; Director of JF
Central, Hong Kong Asset Management Limited and Ayudhya JF
Treasurer and Director, Class II Asset Management.
------------------------------------------------------------------------------------------------------------------------------------
Simon J. Crinage Since 2003 President of the Fund; Vice President, 1 None
(May 10, 1965) JPMorgan Fleming Asset Management since
Finsbury Dials, 20 Finsbury Street September 2000. Prior to that, Director
London EC2Y 9AQ of J.P. Morgan Fleming Asset Management
United Kingdom (UK) Limited.
President and Director, Class III
------------------------------------------------------------------------------------------------------------------------------------
OFFICER(S) WHO ARE NOT DIRECTORS
------------------------------------------------------------------------------------------------------------------------------------
Philip Jones Since 2004 Secretary of the Fund; Associate N/A N/A
(April 4, 1948) JPMorgan Fleming Asset Management since
Finsbury Dials, 20 Finsbury Street March 2003. Prior to that, Senior
London EC2Y 9AQ Associate of the ING Group
United Kingdom
Secretary
------------------------------------------------------------------------------------------------------------------------------------

1 Number I, II or III below a director's name indicates whether he serves in Class I, II, or III or the Board of Directors. Class
III directors will be elected for three-year terms as of the 2005 Annual Meeting. Class I directors will serve until the 2006
Annual Meeting with the position then becoming one for subsequent three-year terms. Class II directors will serve until the 2007
Annual Meeting with the position then becoming one for subsequent three-year terms.
2 The Fund is the only fund in the Fund Complex.

-- 24 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN
--------------------------------------------------------------------------------
THE FUND OPERATES AN OPTIONAL DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN (THE
"PLAN") WHEREBY:

a) shareholders may elect to receive dividend and capital gain distributions
in the form of additional shares of the Fund (the Share Distribution
Plan).

b) shareholders may make optional payments (any amount between $100 and
$3,000) which will be used to purchase additional shares in the open
market (the Share Purchase Plan).

FOR A COPY OF THE PLAN BROCHURE, AS WELL AS A DIVIDEND REINVESTMENT
AUTHORIZATION CARD, PLEASE CONTACT THE PLAN AGENT:

EquiServe Trust Company N.A.
P. O. Box 43010
Providence, RI 02940-3010
Telephone No: 800-426-5523 (toll-free)

The following should be noted with respect to the Plan:

If you participate in the Share Distribution Plan, whenever the Board of
Directors of the Fund declares an income dividend or net capital gain
distribution, you will automatically receive your distribution in newly issued
shares (cash will be paid in lieu of fractional shares) if the market price of
the shares on the date of the distribution is at or above the net asset value of
the shares. The number of shares to be issued to you by the Fund will be
determined by dividing the amount of the cash distribution to which you are
entitled (net of any applicable withholding taxes) by the greater of the net
asset value (NAV) per share on such date or 95% of the market price of a share
on such date. If the market price of the shares on such a distribution date is
below the NAV, the Plan Agent will, as agent for the participants, buy shares on
the open market, on the New York Stock Exchange or elsewhere, for the
participant's account on, or after, the payment date. There is no service charge
for purchases under this Plan.

For U.S. federal income tax purposes, shareholders receiving newly issued shares
pursuant to the Share Distribution Plan will be treated as receiving income or
capital gains in an amount equal to the fair market value (determined as of the
distribution date) of the shares received and will have a cost basis equal to
such fair market value. Shareholders receiving a distribution in the form of
shares purchased in the open market pursuant to the Plan will be treated as
receiving a distribution of the cash distribution that such shareholder would
have received had the shareholder not elected to have such distribution
reinvested and will have a cost basis in such shares equal to the amount of the
distribution.

There will be no brokerage charge to participants for shares issued directly by
the Fund under the Plan. Each participant will pay a pro rata share of brokerage
commissions incurred with respect to the Plan Agent's open market purchases of
shares in connection with the Plan. The Fund will pay the fees of the Plan Agent
for handling the Plan.

You may terminate your account under the Share Distribution Plan by notifying
the Plan Agent in writing. The Plan may be terminated by the Plan Agent or the
Fund with notice to you at least 30 days prior to any record date for the
payment of any distribution by the Fund. Upon any termination, the Plan Agent
will deliver a certificate or certificates for the full shares held for you
under the Plan and a cash adjustment for any fractional shares.

You also have the option of instructing the Plan Agent to make semiannual cash
purchases of shares in the open market. There is a service charge of $1.25 for
each purchase under this Share Purchase Plan.

-- 25 --

[GRAPHIC OMITTED]
JF CHINA REGION FUND, INC.

DIRECTORS AND ADMINISTRATION
--------------------------------------------------------------------------------

OFFICERS AND DIRECTORS THE RT. HON. THE EARL OF CROMER - DIRECTOR AND
CHAIRMAN OF THE BOARD
A. Douglas Eu - Director and Treasurer
Simon J. Crinage - Director and President
Alexander R. Hamilton - Director
Julian M. I. Reid - Director
Philip Jones - Secretary

INVESTMENT ADVISER JF INTERNATIONAL MANAGEMENT INC.
P.O. Box 3151
Road Town, Tortola
British Virgin Islands

ADMINISTRATOR PFPC INC.
301 Bellevue Parkway
Wilmington, Delaware 19809
U.S.A.

CUSTODIAN CITIBANK N.A.
NEW YORK:
111 Wall Street, 16th Floor
New York, New York 10005
U.S.A.

HONG KONG:
Citibank Tower
Citibank Plaza
3 Garden Road
Hong Kong

INDEPENDENT REGISTERED PRICEWATERHOUSECOOPERS LLP
PUBLIC ACCOUNTING FIRM Two Commerce Square
2001 Market Street
Philadelphia, Pennsylvania 19103
U.S.A.

LEGAL COUNSEL CLEARY GOTTLIEB STEEN & HAMILTON LLP
NEW YORK:
1 Liberty Plaza
New York, New York 10006
U.S.A.

HONG KONG:
Bank of China Tower
1 Garden Road
Hong Kong

REGISTRAR, TRANSFER AGENT, AND EQUISERVE TRUST COMPANY N.A.
DIVIDEND PAYING AGENT P. 0. Box 43010
Providence, RI 02940-3010
U.S.A.

NOTICE IS HEREBY GIVEN IN ACCORDANCE WITH SECTION 23(c) OF THE INVESTMENT
COMPANY ACT OF 1940, AS AMENDED, THAT FROM TIME TO TIME THE FUND MAY PURCHASE
SHARES OF ITS COMMON STOCK IN THE OPEN MARKET.

WWW.JPMORGANFLEMING.COM/JFCHINAREGION

-- 26 --

ITEM 2. CODE OF ETHICS.

(a) The registrant, as of the end of the period covered by this report,
has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal
accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party.

(c) There have been no amendments, during the period covered by this
report, to a provision of the code of ethics that applies to the
registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing
similar functions, regardless of whether these individuals are
employed by the registrant or a third party, and that relates to any
element of the code of ethics description.

(d) The registrant has not granted any waivers, including an implicit
waiver, from a provision of the code of ethics that applies to the
registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing
similar functions, regardless of whether these individuals are
employed by the registrant or a third party, that relates to one or
more of the items set forth in paragraph (b) of this item's
instructions.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

Registrant's Board of Directors has determined that it does not have an "audit
committee financial expert" serving on its audit committee. While Registrant
believes that each of the members of its audit committee has sufficient
knowledge of accounting principles and financial statements to serve on the
audit committee, none has the requisite experience to qualify as an "audit
committee financial expert" as such term is defined by the Securities and
Exchange Commission.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

Audit Fees
----------

(a) The aggregate fees billed for each of the last two fiscal years for
professional services rendered by the principal accountant for the
audit of the registrant's annual financial statements or services that
are normally provided by the accountant in connection with statutory
and regulatory filings or engagements for those fiscal years are
$36,750 for 2004 and $35,000 for 2003.

Audit-Related Fees
------------------

(b) The aggregate fees billed in each of the last two fiscal years for
assurance and related services by the principal accountant that are
reasonably related to the performance of the audit of the registrant's
financial statements and are not reported under paragraph (a) of this
Item are $0 for 2004 and $0 for 2003.

Tax Fees
--------

(c) The aggregate fees billed in each of the last two fiscal years for
professional services rendered by the principal accountant for tax
compliance, tax advice, and tax planning are $0 for 2004 and $0 for
2003.

All Other Fees
--------------

(d) The aggregate fees billed in each of the last two fiscal years for
products and services provided by the principal accountant, other than
the services reported in paragraphs (a) through (c) of this Item are
$0 for 2004 and $0 for 2003.

(e)(1) Disclose the audit committee's pre-approval policies and
procedures described in paragraph (c)(7) of Rule 2-01 of
Regulation S-X.

The registrant's Audit Committee shall pre-approve, to the extent
required by applicable law, all audit and non-audit services that
the registrant's independent auditors provide to the registrant
and (ii) all non-audit services that the registrant's independent
auditors provide to the registrant's investment adviser and any
entity controlling, controlled by, or under common control with
the registrant's investment adviser that provides ongoing services
to the registrant, if the engagement relates directly to the
operations and financial reporting of the registrant.

(e)(2) The percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee
pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X
are as follows:

(b) Not applicable.

(d) Not applicable.

(f) The percentage of hours expended on the principal accountant's
engagement to audit the registrant's financial statements for the most
recent fiscal year that were attributed to work performed by persons
other than the principal accountant's full-time, permanent employees
was less than fifty percent.

(g) The aggregate non-audit fees billed by the registrant's accountant for
services rendered to the registrant, and rendered to the registrant's
investment adviser (not including any sub-adviser whose role is
primarily portfolio management and is subcontracted with or overseen
by another investment adviser), and any entity controlling, controlled
by, or under common control with the adviser that provides ongoing
services to the registrant for each of the last two fiscal years of
the registrant was $0 for 2004 and $0 for 2003.

(h) The registrant's audit committee of the board of directors has
considered whether the provision of non-audit services that were
rendered to the registrant's investment adviser (not including any
sub-adviser whose role is primarily portfolio management and is
subcontracted with or overseen by another investment adviser), and any
entity controlling, controlled by, or under common control with the
investment adviser that provides ongoing services to the registrant
that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule
2-01 of Regulation S-X is compatible with maintaining the principal
accountant's independence.

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

The registrant has a separately designated audit committee consisting of all the
independent directors of the registrant. The members of the audit committee are:
The Rt. Hon. The Earl of Cromer, Alexander Reid Hamilton and Julian I.M. Reid.

ITEM 6. SCHEDULE OF INVESTMENTS

Schedule of Investments in securities of unaffiliated issuers as of the close of
the reporting period is included as part of the report to shareholders filed
under Item 1 of this form.

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.

The Proxy Voting Policies are attached herewith.

--------------------------------------------------------------------------------

GLOBAL PROXY VOTING
PROCEDURES AND GUIDELINES

2004 EDITION

OCTOBER 29, 2004

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PX-PROC-1004
01766

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TABLE OF CONTENTS - GLOBAL
--------------------------

PART I: JPMORGAN FLEMING ASSET MANAGEMENT GLOBAL PROXY-VOTING PROCEDURES

A. OBJECTIVE..........................................................3
B. PROXY COMMITTEE....................................................3
C. THE PROXY VOTING PROCESS.........................................3-4
D. MATERIAL CONFLICTS OF INTEREST.....................................5
E. ESCALATION OF MATERIAL CONFLICTS OF INTEREST.......................5
F. RECORDKEEPING......................................................6
EXHIBIT A..........................................................6

PART II: JPMORGAN FLEMING ASSET MANAGEMENT GLOBAL PROXY-VOTING GUIDELINES

A. NORTH AMERICA...................................................8-21
Table of Contents...............................................9-10
Guidelines.....................................................11-21

B. EUROPE, MIDDLE EAST, AFRICA, CENTRAL AMERICA
AND SOUTH AMERICA..............................................22-33
Table of Contents.................................................23
Guidelines.....................................................24-33

C. ASIA (EX-JAPAN)................................................34-42
Table of Contents.................................................35
Guidelines.....................................................36-42

D. JAPAN..........................................................43-44

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PART I: JP MORGAN FLEMING ASSET MANAGEMENT GLOBAL PROXY VOTING PROCEDURES
-----------------------------------------------------------------

A. OBJECTIVE

As an investment adviser within JPMorgan Fleming Asset Management, each of
the entities listed on Exhibit A attached hereto (each referred to
individually as a "JPMFAM Entity" and collectively as "JPMFAM") may be
granted by its clients the authority to vote the proxies of the securities
held in client portfolios. In such cases, JPMFAM's objective is to vote
proxies in the best interests of its clients. To further that objective,
JPMFAM adopted these Procedures. 1

These Procedures incorporate detailed guidelines for voting proxies on
specific types of issues (the "Guidelines"). The Guidelines have been
developed and approved by the relevant Proxy Committee (as defined below)
with the objective of encouraging corporate action that enhances
shareholder value. Because proxy proposals and individual company facts and
circumstances may vary, JPMFAM may not always vote proxies in accordance
with the Guidelines.

B. PROXY COMMITTEE

To oversee the proxy-voting process on an ongoing basis, a Proxy Committee
will be established for each global location where proxy-voting decisions
are made. Each Proxy Committee will be composed of a Proxy Administrator
(as defined below) and senior officers from among the Investment, Legal,
Compliance and Risk Management Departments. The primary functions of each
Proxy Committee are to periodically review general proxy-voting matters; to
determine the independence of any third-party vendor which it has delegated
proxy voting responsibilities and to conclude that there are no conflicts
of interest that would prevent such vendor from providing such proxy voting
services prior to delegating proxy responsibilities; review and approve the
Guidelines annually; and provide advice and recommendations on general
proxy-voting matters as well as on specific voting issues to be implemented
by the relevant JPMFAM Entity. The Proxy Committee may delegate certain of
its responsibilities to subgroups composed of Proxy Committee members. The
Proxy Committee meets at least semi-annually, or more frequently as
circumstances dictate.

C. THE PROXY VOTING PROCESS 2

JPMFAM investment professionals monitor the corporate actions of the
companies held in their clients' portfolios. To assist JPMFAM investment
professionals with public companies' proxy voting proposals, a JPMFAM
Entity may, but shall not be obligated to, retain the services of an
independent proxy voting service ("Independent Voting Service"). The
Independent Voting Service is assigned responsibility for various
functions, which may include one or more of the following: coordinating
with client custodians to ensure that all proxy materials are processed in
a timely fashion; providing JPMFAM with a comprehensive analysis of each
proxy proposal and providing JPMFAM with recommendations on how to vote
each proxy proposal based on the Guidelines or, where no Guideline exists
or where the Guidelines require a case-by-case analysis, on the Independent
Voting Service's analysis; and executing the voting of the proxies in
accordance with Guidelines and its recommendation, except when a
recommendation is overridden by JPMFAM, as described below. If those
functions are not assigned to an Independent Voting Service, they are
performed or coordinated by a Proxy Administrator (as defined below).

-----------------------
1 The Washington Management Group votes proxies for the JPMorgan Value
Opportunities Fund in accordance with their own voting policies and
not the policies of JPMFAM. The JPMorgan Multi-Manager Funds vote
proxies in accordance with the voting policies of each of the
Managers, as applicable, and not the policies of JPMFAM, except, to
the extent the JPMFAM policies apply to the JPMorgan Multi-Manager
Small Cap Value Fund. The Undiscovered Managers Behavioral Growth
Fund, Undiscovered Managers Behavioral Value Fund, and UM Small Cap
Growth Fund vote proxies in accordance with the voting policies of
their subadvisers and not the policies of JPMFAM. In the case of the
Reich and Tang Funds in which J.P. Morgan Funds Distributors Inc.
serves as the distributor, the board of trustees and officers of Reich
and Tang have assumed the responsibility for fulfilling its proxy
voting obligations and for preparing, executing, filing and
disseminating the Form N-PX for the applicable registrant.

2 The Proxy Voting Committee may determine: (a) not to recall securities
on loan if, in its judgment, the negative consequences to clients of
recalling the loaned securities would outweigh the benefits of voting
in the particular instance or (b) not to vote certain foreign
securities positions if, in its judgment, the expense and
administrative inconvenience or other burdens outweigh the benefits to
clients of voting the securities.

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C. THE PROXY VOTING PROCESS - CONTINUED

Situations often arise in which more than one JPMFAM client invests in the
same company or in which a single client may invest in the same company but
in multiple accounts. In those situations, two or more clients, or one
client with different accounts, may be invested in strategies having
different investment objectives, investment styles, or portfolio managers.
As a result, JPMFAM may cast different votes on behalf of different clients
or on behalf of the same client with different accounts.

Each JPMFAM Entity appoints a JPMFAM professional to act as a proxy
administrator ("Proxy Administrator") for each global location of such
entity where proxy-voting decisions are made. The Proxy Administrators are
charged with oversight of these Procedures and the entire proxy-voting
process. Their duties, in the event an Independent Voting Service is
retained, include the following: evaluating the quality of services
provided by the Independent Voting Service; escalating proposals identified
by the Independent Voting Service as non-routine, but for which a Guideline
exists (including, but not limited to, compensation plans, anti-takeover
proposals, reincorporation, mergers, acquisitions and proxy-voting
contests) to the attention of the appropriate investment professionals and
confirming the Independent Voting Service's recommendation with the
appropriate JPMFAM investment professional (documentation of those
confirmations will be retained by the appropriate Proxy Administrator);
escalating proposals identified by the Independent Voting Service as not
being covered by the Guidelines (including proposals requiring a
case-by-case determination under the Guidelines) to the appropriate
investment professional and obtaining a recommendation with respect
thereto; reviewing recommendations of JPMFAM investment professionals with
respect to proposals not covered by the Guidelines (including proposals
requiring a case-by-case determination under the Guidelines) or to override
the Guidelines (collectively, "Overrides"); referring investment
considerations regarding Overrides to the Proxy Committee, if necessary;
determining, in the case of Overrides, whether a material conflict, as
described below, exists; escalating material conflicts to the Proxy
Committee; and maintaining the records required by these Procedures.

In the event investment professionals are charged with recommending how to
vote the proxies, the Proxy Administrator's duties include the following:
reviewing recommendations of investment professionals with respect to
Overrides; referring investment considerations regarding such Overrides to
the Proxy Committee, if necessary; determining, in the case of such
Overrides, whether a material conflict, as described below, exists;
escalating material conflicts to the Proxy Committee; and maintaining the
records required by these Procedures.

IN THE EVENT A JPMFAM INVESTMENT PROFESSIONAL MAKES A RECOMMENDATION IN
CONNECTION WITH AN OVERRIDE, THE INVESTMENT PROFESSIONAL MUST PROVIDE THE
APPROPRIATE PROXY ADMINISTRATOR WITH A WRITTEN CERTIFICATION
("CERTIFICATION") WHICH SHALL CONTAIN AN ANALYSIS SUPPORTING HIS OR HER
RECOMMENDATION AND A CERTIFICATION THAT HE OR SHE (A) RECEIVED NO
COMMUNICATION IN REGARD TO THE PROXY THAT WOULD VIOLATE EITHER THE J.P.
MORGAN CHASE ("JPMC") SAFEGUARD POLICY (AS DEFINED BELOW) OR WRITTEN POLICY
ON INFORMATION BARRIERS, OR RECEIVED ANY COMMUNICATION IN CONNECTION WITH
THE PROXY SOLICITATION OR OTHERWISE THAT WOULD SUGGEST THE EXISTENCE OF AN
ACTUAL OR POTENTIAL CONFLICT BETWEEN JPMFAM'S INTERESTS AND THAT OF ITS
CLIENTS AND (B) WAS NOT AWARE OF ANY PERSONAL OR OTHER RELATIONSHIP THAT
COULD PRESENT AN ACTUAL OR POTENTIAL CONFLICT OF INTEREST WITH THE CLIENTS'
INTERESTS.

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D. MATERIAL CONFLICTS OF INTEREST

The U.S. Investment Advisers Act of 1940 requires that the proxy-voting
procedures adopted and implemented by a U.S. investment adviser include
procedures that address material conflicts of interest that may arise
between the investment adviser's interests and those of its clients. To
address such material potential conflicts of interest, JPMFAM relies on
certain policies and procedures. In order to maintain the integrity and
independence of JPMFAM's investment processes and decisions, including
proxy-voting decisions, and to protect JPMFAM's decisions from influences
that could lead to a vote other than in its clients' best interests, JPMC
(including JPMFAM) adopted a Safeguard Policy, and established formal
informational barriers designed to restrict the flow of information from
JPMC's securities, lending, investment banking and other divisions to
JPMFAM investment professionals. The information barriers include, where
appropriate: computer firewalls; the establishment of separate legal
entities; and the physical separation of employees from separate business
divisions. Material conflicts of interest are further avoided by voting in
accordance with JPMFAM's predetermined Guidelines. When an Override occurs,
any potential material conflict of interest that may exist is analyzed in
the process outlined in these Procedures.

Examples of such material conflicts of interest that could arise include
circumstances in which: (i) management of a JPMFAM investment management
client or prospective client, distributor or prospective distributor of its
investment management products, or critical vendor, is soliciting proxies
and failure to vote in favor of management may harm JPMFAM's relationship
with such company and materially impact JPMFAM's business; or (ii) a
personal relationship between a JPMFAM officer and management of a company
or other proponent of a proxy proposal could impact JPMFAM's voting
decision.

E. ESCALATION OF MATERIAL CONFLICTS OF INTEREST

When an Override occurs, the investment professional must complete the
Certification and the Proxy Administrator will review the circumstances
surrounding such Certification. When a potential material conflict of
interest has been identified, the Proxy Administrator, in consultation with
a subgroup of the Proxy Committee, will evaluate the potential conflict and
determine whether an actual material conflict of interest exists. That
subgroup shall include a Proxy Committee member from the Investment
Department and one or more Proxy Committee members from the Legal,
Compliance or Risk Management Departments. In the event that the Proxy
Administrator and the subgroup of the Proxy Committee determine that an
actual material conflict of interest exists, they shall make a
recommendation on how the relevant JPMFAM Entity shall vote the proxy.
Sales and marketing professionals will be precluded from participating in
the decision-making process.

Depending upon the nature of the material conflict of interest, JPMFAM, in
the course of addressing the material conflict, may elect to take one or
more of the following measures, or other appropriate action:

o removing certain JPMFAM personnel from the proxy voting process;
o "walling off" personnel with knowledge of the material conflict to
ensure that such personnel do not influence the relevant proxy vote;
o voting in accordance with the applicable Guidelines, if any, if the
application of the Guidelines would objectively result in the casting
of a proxy vote in a predetermined manner; or
o deferring the vote to the Independent Voting Service, if any, which
will vote in accordance with its own recommendation.

The resolution of all potential and actual material conflict issues will be
documented in order to demonstrate that JPMFAM acted in the best interests
of its clients.

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F. RECORDKEEPING

JPMFAM is required to maintain in an easily accessible place for seven (7)
years all records relating to the proxy voting process. Those records
include the following:

o a copy of the JPMFAM Proxy Voting Procedures and Guidelines;
o a copy of each proxy statement received on behalf of JPMFAM clients;
o a record of each vote cast on behalf of JPMFAM client holdings;
o a copy of all documents created by JPMFAM personnel that were material
to making a decision on the voting of client securities or that
memorialize the basis of the decision;
o a copy of the documentation of all dialogue with issuers and JPMFAM
personnel created by JPMFAM personnel prior to the voting of client
securities; and
o a copy of each written request by a client for information on how
JPMFAM voted proxies on behalf of the client, as well as a copy of any
written response by JPMFAM to any request by a JPMFAM client for
information on how JPMFAM voted proxies on behalf of our client.

It should be noted that JPMFAM reserves the right to use the services of
the Independent Voting Service to maintain certain required records in
accordance with all applicable regulations.

EXHIBIT A
---------

Banc One High Yield Partners, LLC
Banc One Investment Advisors Corporation
Bank One Trust Company, NA
J.P. Morgan Chase Bank
J.P. Morgan Fleming Asset Management (London) Limited
J.P. Morgan Fleming Asset Management (UK) Limited
J.P. Morgan Investment Management Inc.
J.P. Morgan Investment Management Limited
JF Asset Management Limited
JF Asset Management (Singapore) Limited
JF International Management Inc.

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PART II: PROXY VOTING GUIDELINES
--------------------------------

JPMFAM is a global asset management organization with the capabilities to invest
in securities of issuers located around the globe. Because the regulatory
framework and the business cultures and practices vary from region to region,
our proxy voting guidelines have been customized for each region to take into
account such variations.

JMPFAM currently has four sets of proxy voting guidelines covering the regions
of (1) North America, (2) Europe, Middle East, Africa, Central America and South
America (3) Asia (ex-Japan) and (4) Japan, respectively. Notwithstanding the
variations among the guidelines, all of these guidelines have been designed with
the uniform objective of encouraging corporate action that enhances shareholder
value. As a general rule, in voting proxies of a particular security, each
JPMFAM Entity will apply the guidelines of the region in which the issuer of
such security is organized.

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PART II.A: NORTH AMERICA PROXY VOTING
-------------------------------------

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PART II.A: NORTH AMERICA GUIDELINES TABLE OF CONTENTS
-----------------------------------------------------

1. UNCONTESTED DIRECTOR ELECTIONS...........................................................11

2. PROXY CONTESTS...........................................................................11
a. Election of Directors.................................................................11
b. Reimburse Proxy Solicitation Expenses.................................................11

3. RATIFICATION OF AUDITORS.................................................................11

4. PROXY CONTEST DEFENSES................................................................12-13
a. Board Structure: Staggered vs. Annual Elections.......................................12
b. Shareholder Ability to Remove Directors...............................................12
c. Cumulative Voting.....................................................................12
d. Shareholder Ability to Call Special Meeting...........................................13
e. Shareholder Ability to Act by Written Consent.........................................13
f. Shareholder Ability to Alter the Size of the Board....................................13

5. TENDER OFFER DEFENSES.................................................................13-14
a. Poison Pills..........................................................................13
b. Fair Price Provisions.................................................................13
c. Greenmail.............................................................................13
d. Unequal Voting Rights.................................................................13
e. Supermajority Shareholder Vote Requirement to Amend Charter or Bylaws.................13
f. Supermajority Shareholder Vote Requirement to Approve Mergers.........................14

6. MISCELLANEOUS BOARD PROVISIONS........................................................14-15
a. Separate Chairman and CEO Positions...................................................14
b. Lead Directors and Executive Sessions.................................................14
c. Majority of Independent Directors.....................................................14
d. Stock Ownership Requirements..........................................................14
e. Term of Office........................................................................15
f. Director and Officer Indemnification and Liability Protection.........................15
g. Board Size............................................................................15

7. MISCELLANEOUS GOVERNANCE PROVISIONS...................................................15-16
a. Independent Nominating Committee......................................................15
b. Confidential Voting...................................................................15
c. Equal Access..........................................................................15
d. Bundled Proposals.....................................................................15
e. Charitable Contributions..............................................................15
f. Date/Location of Meeting..............................................................15
g. Include Nonmanagement Employees on Board..............................................16
h. Adjourn Meeting if Votes are Insufficient.............................................16
i. Other Business........................................................................16
j. Disclosure of Shareholder Proponents..................................................16

8. CAPITAL STRUCTURE.....................................................................16-17
a. Common Stock Authorization............................................................16
b. Stock Distributions: Splits and Dividends.............................................16
c. Reverse Stock Splits..................................................................16
d. Blank Check Preferred Authorization...................................................16
e. Shareholder Proposals Regarding Blank Check Preferred Stock...........................16
f. Adjustments to Par Value of Common Stock..............................................16
g. Restructurings/Recapitalizations......................................................17
h. Share Repurchase Programs.............................................................17
i. Targeted Share Placements.............................................................17

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PART II.A: NORTH AMERICA GUIDELINES TABLE OF CONTENTS
-----------------------------------------------------

9. EXECUTIVE AND DIRECTOR COMPENSATION...................................................17-18
a. Stock-based Incentive Plans........................................................17-18
b. Approval of Cash or Cash-and-Stock Bonus Plans........................................18
c. Shareholder Proposals to Limit Executive and Director Pay.............................18
d. Golden and Tin Parachutes.............................................................18
e. 401(k) Employee Benefit Plans.........................................................18
f. Employee Stock Purchase Plans.........................................................18
g. Option Expensing......................................................................18
h. Option Repricing......................................................................18
i. Stock Holding Periods.................................................................18

10. INCORPORATION............................................................................19
a. Reincorporation Outside of the United States..........................................19
b. Voting on State Takeover Statutes.....................................................19
c. Voting on Reincorporation Proposals...................................................19

11. MERGERS AND CORPORATE RESTRUCTURINGS.....................................................19
a. Mergers and Acquisitions..............................................................19
b. Nonfinancial Effects of a Merger or Acquisition.......................................19
c. Corporate Restructuring...............................................................19
d. Spin-offs.............................................................................19
e. Asset Sales...........................................................................19
f. Liquidations..........................................................................19
g. Appraisal Rights......................................................................19
h. Changing Corporate Name...............................................................19

12. SOCIAL AND ENVIRONMENTAL ISSUES.......................................................19-20
a. Energy and Environment................................................................19
b. Northern Ireland......................................................................20
c. Military Business.....................................................................20
d. International Labor Organization Code of Conduct......................................20
e. Promote Human Rights in China, Nigeria, and Burma.....................................20
f. World Debt Crisis.....................................................................20
g. Equal Employment Opportunity and Discrimination.......................................20
h. Animal Rights.........................................................................20
i. Product Integrity and Marketing.......................................................20
j. Human Resources Issues................................................................20
k. Link Executive Pay with Social and/or Environmental Criteria..........................20

13. FOREIGN PROXIES..........................................................................21

14. PRE-SOLICITATION CONTACT.................................................................21

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PART II.A: NORTH AMERICA GUIDELINES
-----------------------------------

1. UNCONTESTED DIRECTOR ELECTIONS
Votes on director nominees should be made on a CASE-BY-CASE (for) basis.
Votes generally will be WITHHELD from directors who:

1) attend less than 75 percent of the board and committee meetings without
a valid excuse for the absences; or

2) implement or renew a dead-hand or modified dead-hand poison pill; or

3) are inside or affiliated outside directors and sit on the audit,
compensation, or nominating committees; or

4) ignore a shareholder proposal that is approved by a i) majority of the
shares outstanding, or ii) majority of the votes cast for two consecutive
years; or

5) are inside or affiliated outside directors and the full board serves as
the audit, compensation, or nominating committee or the company does not
have one of these committees; or

6) WITHHOLD votes from insiders and affiliated outsiders on boards that are
not at least majority independent; or

7) WITHHOLD votes from directors who sit on more than six boards; or

8) WITHHOLD votes from compensation committee members where there is a
pay-for performance disconnect for Russell 3000 companies. (See 9a -
Stock-Based Incentive Plans, last paragraph).

Special attention will be paid to companies that display a chronic lack of
shareholder accountability.

2. PROXY CONTESTS
2A. ELECTION OF DIRECTORS
Votes in a contested election of directors must be evaluated on a
CASE-BY-CASE basis, considering the following factors: long-term financial
performance of the subject company relative to its industry; management's
track record; background to the proxy contest; qualifications of director
nominees (both slates); evaluation of what each side is offering
shareholders as well as the likelihood that the proposed objectives and
goals can be met; and stock ownership positions.

2B. REIMBURSE PROXY SOLICITATION EXPENSES
Decisions to provide full reimbursement for dissidents waging a proxy
contest should be made on a CASE-BY-CASE basis.

3. RATIFICATION OF AUDITORS
Vote FOR proposals to ratify auditors, unless an auditor has a financial
interest in or association with the company, and is therefore not
independent; or there is reason to believe that the independent auditor has
rendered an opinion that is neither accurate nor indicative of the
company's financial position.

Generally vote AGAINST auditor ratification and WITHHOLD votes from Audit
Committee members if non-audit fees exceed audit fees.

Generally vote FOR shareholder proposals asking for audit firm rotation
unless the rotation period is so short (less than five years) that it would
be unduly burdensome to the company.

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4. PROXY CONTEST DEFENSES
4A. BOARD STRUCTURE: STAGGERED VS. ANNUAL ELECTIONS
Proposals regarding classified boards will be voted on a CASE-BY-CASE
basis. Classified boards normally will be supported if the company's
governing documents contain each of the following provisions:

1) Majority of board composed of independent directors,

2) Nominating committee composed solely of independent directors,

3) Do not require more than a two-thirds shareholders' vote to remove a
director, revise any bylaw or revise any classified board provision,

4) Confidential voting (however, there may be a provision for suspending
confidential voting during proxy contests),

5) Ability of shareholders to call special meeting or to act by written
consent with 90 days' notice,

6) Absence of superior voting rights for one or more classes of stock,

7) Board does not have the sole right to change the size of the board
beyond a stated range that has been approved by shareholders, and

8) Absence of shareholder rights plan that can only be removed by the
incumbent directors (dead-hand poison pill).

4B. SHAREHOLDER ABILITY TO REMOVE DIRECTORS
Vote AGAINST proposals that provide that directors may be removed ONLY for
cause.

Vote FOR proposals to restore shareholder ability to remove directors with
or without cause.

Vote AGAINST proposals that provide that only continuing directors may
elect replacements to fill board vacancies.

Vote FOR proposals that permit shareholders to elect directors to fill
board vacancies.

4C. CUMULATIVE VOTING
Cumulative voting proposals will be voted on a CASE-BY-CASE basis. If there
are other safeguards to ensure that shareholders have reasonable access and
input into the process of nominating and electing directors, cumulative
voting is not essential. Generally, a company's governing documents must
contain the following provisions for us to vote against restoring or
providing for cumulative voting:

1) Annually elected board,

2) Majority of board composed of independent directors,

3) Nominating committee composed solely of independent directors,

4) Confidential voting (however, there may be a provision for suspending
confidential voting during proxy contests),

5) Ability of shareholders to call special meeting or to act by written
consent with 90 days' notice,

6) Absence of superior voting rights for one or more classes of stock,

7) Board does not have the sole right to change the size of the board
beyond a stated range that has been approved by shareholders, and

8) Absence of shareholder rights plan that can only be removed by the
incumbent directors (dead- hand poison pill).

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4D. SHAREHOLDER ABILITY TO CALL SPECIAL MEETING
Vote AGAINST proposals to restrict or prohibit shareholder ability to call
special meetings. The ability to call special meetings enables shareholders
to remove directors or initiate a shareholder resolution without having to
wait for the next scheduled meeting.

Vote FOR proposals that remove restrictions on the right of shareholders to
act independently of management.

4E. SHAREHOLDER ABILITY TO ACT BY WRITTEN CONSENT
We generally vote FOR proposals to restrict or prohibit shareholder ability
to take action by written consent. The requirement that all shareholders be
given notice of a shareholders' meeting and matters to be discussed therein
seems a reasonable protection of minority shareholder rights.

We generally vote AGAINST proposals to allow or facilitate shareholder
action by written consent.

4F. SHAREHOLDER ABILITY TO ALTER THE SIZE OF THE BOARD
Vote FOR proposals that seek to fix the size of the board.

Vote AGAINST proposals that give management the ability to alter the size
of the board without shareholder approval.

5. TENDER OFFER DEFENSES
5A. POISON PILLS
Vote FOR shareholder proposals that ask a company to submit its poison pill
for shareholder ratification.

Review on a CASE-BY-CASE basis shareholder proposals to redeem a company's
poison pill. Studies indicate that companies with a rights plan secure
higher premiums in hostile takeoversituations.

Review on a CASE-BY-CASE basis management proposals to ratify a poison
pill. We generally look for shareholder friendly features including a two-
to three-year sunset provision, a permitted bid provision, a 20 percent or
higher flip-in provision, and the absence of dead-hand features.

5B. FAIR PRICE PROVISIONS
Vote proposals to adopt fair price provisions on a CASE-BY-CASE basis,
evaluating factors such as the vote required to approve the proposed
acquisition, the vote required to repeal the fair price provision, and the
mechanism for determining the fair price.

Generally, vote AGAINST fair price provisions with shareholder vote
requirements greater than a majority of disinterested shares.

5C. GREENMAIL
Vote FOR proposals to adopt antigreenmail charter or bylaw amendments or
otherwise restrict a company's ability to make greenmail payments.

5D. UNEQUAL VOTING RIGHTS
Generally, vote AGAINST dual-class recapitalizations as they offer an
effective way for a firm to thwart hostile takeovers by concentrating
voting power in the hands of management or other insiders.

Vote FOR dual-class recapitalizations when the structure is designed to
protect economic interests of investors.

5E. SUPERMAJORITY SHAREHOLDER VOTE REQUIREMENT TO AMEND CHARTER OR BYLAWS
Vote AGAINST management proposals to require a supermajority shareholder
vote to approve charter and bylaw amendments. Supermajority provisions
violate the principle that a simple majority of voting shares should be all
that is necessary to effect change regarding a company.

Vote FOR shareholder proposals to lower supermajority shareholder vote
requirements for charter and bylaw amendments.

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5F. SUPERMAJORITY SHAREHOLDER VOTE REQUIREMENT TO APPROVE MERGERS
Vote AGAINST management proposals to require a supermajority shareholder
vote to approve mergers and other significant business combinations.
Supermajority provisions violate the principle that a simple majority of
voting shares should be all that is necessary to effect change regarding a
company.

Vote FOR shareholder proposals to lower supermajority shareholder vote
requirements for mergers and other significant business combinations.

6. MISCELLANEOUS BOARD PROVISIONS
6A. SEPARATE CHAIRMAN AND CEO POSITIONS
We will generally vote for proposals looking to separate the CEO and
Chairman roles unless the company has governance structures in place that
can satisfactorily counterbalance a combined chairman and CEO/president
post. Such a structure should include most or all of the following:

o Designated lead director, appointed from the ranks of the
independent board members with clearly delineated duties. At a
minimum these should include:

(1) Presides at all meetings of the board at which the chairman
is not present, including executive sessions of the
independent directors,

(2) Serves as liaison between the chairman and the independent
directors,

(3) Approves information sent to the board,

(4) Approves meeting agendas for the board,

(5) Approves meeting schedules to assure that there is
sufficient time for discussion of all agenda items,

(6) Has the authority to call meetings of the independent
directors, and

(7) If requested by major shareholders, ensures that he is
available for consultation and direct communication;

o 2/3 of independent board;

o All-independent key committees;

o Committee chairpersons nominated by the independent directors;

o CEO performance is reviewed annually by a committee of outside
directors; and

o Established governance guidelines.

6B. LEAD DIRECTORS AND EXECUTIVE SESSIONS
In cases where the CEO and Chairman roles are combined, we will vote FOR
the appointment of a "lead" (non-insider) director and for regular
"executive" sessions (board meetings taking place without the CEO/Chairman
present).

6C. MAJORITY OF INDEPENDENT DIRECTORS
We generally vote FOR proposals that call for the board to be composed of a
majority of independent directors. We believe that a majority of
independent directors can be an important factor in facilitating objective
decision making and enhancing accountability to shareholders.

Vote FOR shareholder proposals requesting that the board's audit,
compensation, and/or nominating committees include independent directors
exclusively.

Generally vote FOR shareholder proposals asking for a 2/3 independent
board.

6D. STOCK OWNERSHIP REQUIREMENTS
Vote FOR shareholder proposals requiring directors to own a minimum amount
of company stock in order to qualify as a director or to remain on the
board, so long as such minimum amount is not excessive or unreasonable.

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6E. TERM OF OFFICE
Vote AGAINST shareholder proposals to limit the tenure of outside
directors. Term limits pose artificial and arbitrary impositions on the
board and could harm shareholder interests by forcing experienced and
knowledgeable directors off the board.

6F. DIRECTOR AND OFFICER INDEMNIFICATION AND LIABILITY PROTECTION
Proposals concerning director and officer indemnification and liability
protection should be evaluated on a CASE-BY-CASE basis.

Vote AGAINST proposals to limit or eliminate director and officer liability
for monetary damages for violating the duty of care.

Vote AGAINST indemnification proposals that would expand coverage beyond
legal expenses to acts, such as negligence, that are more serious
violations of fiduciary obligations than mere carelessness.

Vote FOR proposals that provide such expanded coverage in cases when a
director's or officer's legal defense was unsuccessful only if: (1) the
director was found to have acted in good faith and in a manner that he
reasonably believed was in the company's best interests, and (2) the
director's legal expenses would be covered.

6G. BOARD SIZE
Vote FOR proposals to limit the size of the board to 15 members.

7. MISCELLANEOUS GOVERNANCE PROVISIONS
7A. INDEPENDENT NOMINATING COMMITTEE
Vote FOR the creation of an independent nominating committee.

7B. CONFIDENTIAL VOTING
Vote FOR shareholder proposals requesting that companies adopt confidential
voting, use independent tabulators, and use independent inspectors of
election as long as the proposals include clauses for proxy contests as
follows: In the case of a contested election, management should be
permitted to request that the dissident group honor its confidential voting
policy. If the dissidents agree, the policy remains in place. If the
dissidents do not agree, the confidential voting policy is waived.

Vote FOR management proposals to adopt confidential voting.

7C. EQUAL ACCESS
Vote FOR shareholder proposals that would give significant company
shareholders equal access to management's proxy material in order to
evaluate and propose voting recommendations on proxy proposals and director
nominees and to nominate their own candidates to the board.

7D. BUNDLED PROPOSALS
Review on a CASE-BY-CASE basis bundled or "conditioned" proxy proposals. In
the case of items that are conditioned upon each other, examine the
benefits and costs of the packaged items. In instances where the joint
effect of the conditioned items is not in shareholders' best interests,
vote against the proposals. If the combined effect is positive, support
such proposals.

7E. CHARITABLE CONTRIBUTIONS
Vote AGAINST shareholder proposals regarding charitable contributions. In
the absence of bad faith, self-dealing, or gross negligence, management
should determine which contributions are in the best interests of the
company.

7F. DATE/LOCATION OF MEETING
Vote AGAINST shareholder proposals to change the date or location of the
shareholders' meeting. No one site will meet the needs of all shareholders.

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7G. INCLUDE NONMANAGEMENT EMPLOYEES ON BOARD
Vote AGAINST shareholder proposals to include nonmanagement employees on
the board. Constituency representation on the board is not supported,
rather decisions are based on director qualifications.

7H. ADJOURN MEETING IF VOTES ARE INSUFFICIENT
Vote FOR proposals to adjourn the meeting when votes are insufficient.
Management has additional opportunities to present shareholders with
information about its proposals.

7I. OTHER BUSINESS
Vote FOR proposals allowing shareholders to bring up "other matters" at
shareholder meetings.

7J. DISCLOSURE OF SHAREHOLDER PROPONENTS
Vote FOR shareholder proposals requesting that companies disclose the names
of shareholder proponents. Shareholders may wish to contact the proponents
of a shareholder proposal for additional information.

8. CAPITAL STRUCTURE
8A. COMMON STOCK AUTHORIZATION
Review proposals to increase the number of shares of common stock
authorized for issue on a CASE-BY-CASE basis.

Vote AGAINST proposals to increase the number of authorized shares of a
class of stock that has superior voting rights in companies that have
dual-class capital structure.

8B. STOCK DISTRIBUTIONS: SPLITS AND DIVIDENDS
Vote FOR management proposals to increase common share authorization for a
stock split, provided that the increase in authorized shares would not
result in an excessive number of shares available for issuance given a
company's industry and performance as measured by total shareholder
returns.

8C. REVERSE STOCK SPLITS
Vote FOR management proposals to implement a reverse stock split that also
reduces the number of authorized common shares to a level where the number
of shares available for issuance is not excessive given a company's
industry and performance in terms of shareholder returns.

Vote CASE-BY-CASE on proposals to implement a reverse stock split that does
not proportionately reduce the number of shares authorized for issue.

8D. BLANK CHECK PREFERRED AUTHORIZATION
Vote AGAINST proposals authorizing the creation of new classes of preferred
stock with unspecified voting, conversion, dividend distribution, and other
rights ("blank check" preferred stock).

Vote FOR proposals to create "blank check" preferred stock in cases when
the company expressly states that the stock will not be used as a takeover
device.

Vote FOR proposals to authorize preferred stock in cases when the company
specifies voting, dividend, conversion, and other rights of such stock and
the terms of the preferred stock appear reasonable.

Vote CASE-BY-CASE on proposals to increase the number of blank check
preferred shares after analyzing the number of preferred shares available
for issue given a company's industry and performance as measured by total
shareholder returns.

8E. SHAREHOLDER PROPOSALS REGARDING BLANK CHECK PREFERRED STOCK
Vote FOR shareholder proposals to have blank check preferred stock
placements, other than those shares issued for the purpose of raising
capital or making acquisitions in the normal course of business, submitted
for shareholder ratification.

8F. ADJUSTMENTS TO PAR VALUE OF COMMON STOCK
Vote FOR management proposals to reduce the par value of common stock. The
purpose of par value is to establish the maximum responsibility of a
shareholder in the event that a company becomes insolvent.

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8G. RESTRUCTURINGS/RECAPITALIZATIONS
Review proposals to increase common and/or preferred shares and to issue
shares as part of a debt restructuring plan on a CASE-BY-CASE basis.
Consider the following issues:

DILUTION--How much will ownership interest of existing shareholders be
reduced, and how extreme will dilution to any future earnings be?

CHANGE IN CONTROL--Will the transaction result in a change in control of
the company?

BANKRUPTCY--Generally, approve proposals that facilitate debt
restructurings unless there are clear signs of self-dealing or other
abuses.

8H. SHARE REPURCHASE PROGRAMS
Vote FOR management proposals to institute open-market share repurchase
plans in which all shareholders may participate on equal terms.

8I. TARGETED SHARE PLACEMENTS
These shareholder proposals ask companies to seek stockholder approval
before placing 10% or more of their voting stock with a single investor.
The proposals are in reaction to the placement by various companies of a
large block of their voting stock in an ESOP, parent capital fund or with a
single friendly investor, with the aim of protecting themselves against a
hostile tender offer. These proposals are voted on a CASE BY CASE BASIS
after reviewing the individual situation of the company receiving the
proposal.

9. EXECUTIVE AND DIRECTOR COMPENSATION
9A. STOCK-BASED INCENTIVE PLANS
Votes with respect to compensation plans should be determined on a
CASE-BY-CASE basis. The analysis of compensation plans focuses primarily on
the transfer of shareholder wealth (the dollar cost of pay plans to
shareholders). Other matters included in our analysis are the amount of the
company's outstanding stock to be reserved for the award of stock options,
whether the exercise price of an option is less than the stock's fair
market value at the date of the grant of the options, and whether the plan
provides for the exchange of outstanding options for new ones at lower
exercise prices. Every award type is valued. An estimated dollar cost for
the proposed plan and all continuing plans is derived. This cost, dilution
to shareholders' equity, will also be expressed as a percentage figure for
the transfer of shareholder wealth and will be considered along with
dilution to voting power.

Once the cost of the plan is estimated, it is compared to a
company-specific dilution cap. The allowable cap is industry-specific,
market cap-based, and pegged to the average amount paid by companies
performing in the top quartile of their peer groupings. To determine
allowable caps, companies are categorized according to standard industry
code (SIC) groups. Top quartile performers for each group are identified on
the basis of five-year total shareholder returns. Industry-specific cap
equations are developed using regression analysis to determine those
variables that have the strongest correlation to shareholder value
transfer. Industry equations are used to determine a company-specific
allowable cap; this is accomplished by plugging company specific data into
the appropriate industry equation to reflect size, performance, and levels
of cash compensation.

Votes are primarily determined by this quantitative analysis. If the
proposed plan cost is above the allowable cap, an AGAINST vote is
indicated. If the proposed cost is below the allowable cap, a vote FOR the
plan is indicated unless the plan violates the repricing guidelines. If the
company has a history of repricing options or has the express ability to
reprice underwater stock options without first securing shareholder
approval under the proposed plan, the plan receives an AGAINST vote--even
in cases where the plan cost is considered acceptable based on the
quantitative analysis.

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9A. STOCK-BASED INCENTIVE PLANS - CONTINUED
For companies in the Russell 3000 we will generally vote against a plan
when there is a disconnect between the CEO's pay and performance (an
increase in pay and a decrease in performance), the main source for the pay
increase is equity-based, and the CEO participates in the plan being voted
on. Specifically, if the company has negative one- and three-year total
shareholder returns, and its CEO also had an increase in total direct
compensation from the prior year, it would signify a disconnect in pay and
performance. If more than half of the increase in total direct compensation
is attributable to the equity component, we would generally recommend
against the equity plan in which the CEO participates.

We will generally vote against shareholder proposals for stock-based
incentive plans, for companies in technology sectors, when the plan
includes provisions for expensing options. We are in favor of expensing
options; however, we feel it will disadvantage companies in the technology
sector that we own and we will wait until expensing options become a common
practice within the sector.

9B. APPROVAL OF CASH OR CASH-AND-STOCK BONUS PLANS
Vote FOR cash or cash-and-stock bonus plans to exempt the compensation from
limits on deductibility under the provisions of Section 162(m) of the
Internal Revenue Code.

9C. SHAREHOLDER PROPOSALS TO LIMIT EXECUTIVE AND DIRECTOR PAY
Generally, vote FOR shareholder proposals that seek additional disclosure
of executive and director pay information.

Review on a CASE-BY-CASE basis all other shareholder proposals that seek to
limit executive and director pay.

Review on a CASE-BY-CASE basis shareholder proposals for performance pay
such as indexed or premium priced options if a company has a history of
oversized awards and one-, two- and three-year returns below its peer
group.

9D. GOLDEN AND TIN PARACHUTES
Review on a CASE-BY-CASE basis all proposals to ratify or cancel golden or
tin parachutes. Favor golden parachutes that limit payouts to two times
base salary, plus guaranteed retirement and other benefits.

9E. 401(K) EMPLOYEE BENEFIT PLANS
Vote FOR proposals to implement a 401(k) savings plan for employees.

9F. EMPLOYEE STOCK PURCHASE PLANS
Vote FOR employee stock purchase plans with an offering period of 27 months
or less when voting power dilution is ten percent or less.

Vote AGAINST employee stock purchase plans with an offering period of
greater than 27 months or voting power dilution of greater than ten
percent.

9G. OPTION EXPENSING
Generally, vote FOR shareholder proposals to expense fixed-price options.

Vote AGAINST shareholder proposals to expense fixed-price options in
technology sectors.

9H. OPTION REPRICING
In most cases, we take a negative view of option repricings and will,
therefore, generally vote AGAINST such proposals. We do, however, consider
the granting of new options to be an acceptable alternative and will
generally SUPPORT such proposals.

9I. STOCK HOLDING PERIODS
Generally vote AGAINST all proposals requiring executives to hold the stock
received upon option exercise for a specific period of time.

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10. INCORPORATION
10A. REINCORPORATION OUTSIDE OF THE UNITED STATES
Generally speaking, we will vote AGAINST companies looking to reincorporate
outside of the U.S.

10B. VOTING ON STATE TAKEOVER STATUTES
Review on a CASE-BY-CASE basis proposals to opt in or out of state takeover
statutes (including control share acquisition statutes, control share
cash-out statutes, freezeout provisions, fair price provisions, stakeholder
laws, poison pill endorsements, severance pay and labor contract
provisions, antigreenmail provisions, and disgorgement provisions).

10C. VOTING ON REINCORPORATION PROPOSALS
Proposals to change a company's state of incorporation should be examined
on a CASE-BY-CASE basis. Review management's rationale for the proposal,
changes to the charter/bylaws, and differences in the state laws governing
the companies.

11. MERGERS AND CORPORATE RESTRUCTURINGS
11A. MERGERS AND ACQUISITIONS
Votes on mergers and acquisitions should be considered on a CASE-BY-CASE
basis, taking into account factors including the following: anticipated
financial and operating benefits; offer price (cost vs. premium); prospects
of the combined companies; how the deal was negotiated; and changes in
corporate governance and their impact on shareholder rights.

11B. NONFINANCIAL EFFECTS OF A MERGER OR ACQUISITION
Some companies have proposed a charter provision which specifies that the
board of directors may examine the nonfinancial effect of a merger or
acquisition on the company. This provision would allow the board to
evaluate the impact a proposed change in control would have on employees,
host communities, suppliers and/or others. We generally vote AGAINST
proposals to adopt such charter provisions. We feel it is the directors'
fiduciary duty to base decisions solely on the financial interests of the
shareholders.

11C. CORPORATE RESTRUCTURING
Votes on corporate restructuring proposals, including minority squeezeouts,
leveraged buyouts, spin-offs, liquidations, and asset sales, should be
considered on a CASE-BY-CASE basis.

11D. SPIN-OFFS
Votes on spin-offs should be considered on a CASE-BY-CASE basis depending
on the tax and regulatory advantages, planned use of sale proceeds, market
focus, and managerial incentives.

11E. ASSET SALES
Votes on asset sales should be made on a CASE-BY-CASE basis after
considering the impact on the balance sheet/working capital, value received
for the asset, and potential elimination of diseconomies.

11F. LIQUIDATIONS
Votes on liquidations should be made on a CASE-BY-CASE basis after
reviewing management's efforts to pursue other alternatives, appraisal
value of assets, and the compensation plan for executives managing the
liquidation.

11G. APPRAISAL RIGHTS
Vote FOR proposals to restore, or provide shareholders with, rights of
appraisal. Rights of appraisal provide shareholders who are not satisfied
with the terms of certain corporate transactions the right to demand a
judicial review in order to determine a fair value for their shares.

11H. CHANGING CORPORATE NAME
Vote FOR changing the corporate name.

12. SOCIAL AND ENVIRONMENTAL ISSUES
12A. ENERGY AND ENVIRONMENT
Vote CASE-BY-CASE on proposals that request companies to subscribe to the
CERES Principles.

Vote CASE-BY-CASE on disclosure reports that seek additional information.

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12B. NORTHERN IRELAND
Vote CASE-BY-CASE on proposals pertaining to the MacBride Principles.

Vote CASE-BY-CASE on disclosure reports that seek additional information
about progress being made toward eliminating employment discrimination.

12C. MILITARY BUSINESS
Vote CASE-BY-CASE on defense issue proposals.

Vote CASE-BY-CASE on disclosure reports that seek additional information on
military-related operations.

12D. INTERNATIONAL LABOR ORGANIZATION CODE OF CONDUCT
Vote CASE-BY-CASE on proposals to endorse international labor organization
code of conducts.

Vote CASE-BY-CASE on disclosure reports that seek additional information on
company activities in this area.

12E. PROMOTE HUMAN RIGHTS IN CHINA, NIGERIA, AND BURMA
Vote CASE-BY-CASE on proposals to promote human rights in countries such as
China, Nigeria, and Burma.

Vote CASE-BY-CASE on disclosure reports that seek additional information on
company activities regarding human rights.

12F. WORLD DEBT CRISIS
Vote CASE-BY-CASE on proposals dealing with third world debt.

Vote CASE-BY-CASE on disclosure reports regarding company activities with
respect to third world debt.

12G. EQUAL EMPLOYMENT OPPORTUNITY AND DISCRIMINATION
Vote CASE-BY-CASE on proposals regarding equal employment opportunities and
discrimination.

Vote CASE-BY-CASE on disclosure reports that seek additional information
about affirmative action efforts, particularly when it appears that
companies have been unresponsive to shareholder requests.

12H. ANIMAL RIGHTS
Vote CASE-BY-CASE on proposals that deal with animal rights.

12I. PRODUCT INTEGRITY AND MARKETING
Vote CASE-BY-CASE on proposals that ask companies to end their production
of legal, but socially questionable, products.

Vote CASE-BY-CASE on disclosure reports that seek additional information
regarding product integrity and marketing issues.

12J. HUMAN RESOURCES ISSUES
Vote CASE-BY-CASE on proposals regarding human resources issues.

Vote CASE-BY-CASE on disclosure reports that seek additional information
regarding human resources issues.

12K. LINK EXECUTIVE PAY WITH SOCIAL AND/OR ENVIRONMENTAL CRITERIA
Vote CASE-BY-CASE on proposals to link executive pay with the attainment of
certain social and/or environmental criteria.

Vote CASE-BY-CASE on disclosure reports that seek additional information
regarding this issue.

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13. FOREIGN PROXIES
Responsibility for voting non-U.S. proxies rests with our Proxy Voting
Committee located in London. The Proxy Committee is composed of senior
analysts and portfolio managers and officers of the Legal and Compliance
Department. It is chaired by a Managing Director of the Firm. A copy of our
policy for voting international proxies can be provided upon request.

14. PRE-SOLICITATION CONTACT
From time to time, companies will seek to contact analysts, portfolio
managers and others in advance of the formal proxy solicitation to solicit
support for certain contemplated proposals. Such contact can potentially
result in the recipient receiving material non-public information and
result in the imposition of trading restrictions. Accordingly,
pre-solicitation contact should occur only under very limited circumstances
and only in accordance with the terms set forth herein.

WHAT IS MATERIAL NON-PUBLIC INFORMATION?
The definition of material non-public information is highly subjective. The
general test, however, is whether or not such information would reasonably
affect an investor's decision to buy, sell or hold securities, or whether
it would be likely to have a significant market impact. Examples of such
information include, but are not limited to:
o a pending acquisition or sale of a substantial business;
o financial results that are better or worse than recent trends would
lead one to expect;
o major management changes;
o an increase or decrease in dividends;
o calls or redemptions or other purchases of its securities by the
company;
o a stock split, dividend or other recapitalization; or
o financial projections prepared by the Company or the Company's
representatives.

WHAT IS PRE-SOLICITATION CONTACT?
Pre-solicitation contact is any communication, whether oral or written,
formal or informal, with the Company or a representative of the Company
regarding proxy proposals prior to publication of the official proxy
solicitation materials. This contact can range from simply polling
investors as to their reaction to a broad topic, e.g., "How do you feel
about dual classes of stock?", to very specific inquiries, e.g., "Here's a
term sheet for our restructuring. Will you vote to approve this?"

Determining the appropriateness of the contact is a factual inquiry which
must be determined on a case-by-case basis. For instance, it might be
acceptable for us to provide companies with our general approach to certain
issues. Promising our vote, however, is prohibited under all circumstances.
Likewise, discussion of our proxy guidelines, in whole or in part, with a
company or others is prohibited. In the event that you are contacted in
advance of the publication of proxy solicitation materials, please notify
the Legal/Compliance Department immediately. The Company or its
representative should be instructed that all further contact should be with
the Legal/Compliance Department.

It is also critical to keep in mind that as a fiduciary, we exercise our
proxies solely in the best interests of our clients. Outside influences,
including those from within J.P. Morgan Chase should not interfere in any
way in our decision making process. Any calls of this nature should be
referred to the Legal/Compliance Department for response.

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PART II.B: EUROPE, MIDDLE EAST, AFRICA, CENTRAL AMERICA AND
------------------------------------------------
SOUTH AMERICA PROXY VOTING
--------------------------

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PART II.B: EUROPE, MIDDLE EAST, AFRICA, CENTRAL AMERICA AND
------------------------------------------------
SOUTH AMERICA GUIDELINES TABLE OF CONTENTS
------------------------------------------

1. REPORTS & ACCOUNTS.....................................................24
a. Annual Report.......................................................24
b. Remuneration Report.................................................24

2. DIVIDENDS..............................................................24

3. AUDITORS...............................................................24
a. Auditor Independence................................................24
b. Auditor Remuneration................................................24

4. BOARDS..............................................................25-26
a. Chairman & CEO......................................................25
b. Board Structure.....................................................25
c. Board Size..........................................................25
d. Board Independence..................................................25
e. Board Committees.................................................25-26

5. DIRECTORS ..........................................................26-27
a. Directors' Contracts................................................26
b. Executive Director Remuneration.....................................26
c. Director Liability..................................................27
d. Directors over 70...................................................27

6. NON-EXECUTIVE DIRECTORS ...............................................27
a. Role of Non-Executive Directors.....................................27
b. Director Independence...............................................27
c. Non-Executive Director Remuneration.................................27
d. Multiple Directorships..............................................27
e. Investment Trust Directors..........................................27

7. ISSUE OF CAPITAL.......................................................28
a. Issue of Equity.....................................................28
b. Issue of Debt.......................................................28
c. Share Repurchase Programmes.........................................28

8. MERGERS/ACQUISITIONS...................................................28

9. VOTING RIGHTS..........................................................28

10. SHARE OPTIONS/LONG-TERM INCENTIVE PLANS (L-TIPS).......................29
a. Share Options.......................................................29
b. Long-Term Incentive Plans (L-TIPs)..................................29

11. OTHERS..............................................................29-30
a. Poison Pills........................................................29
b. Composite Resolutions...............................................30
c. Social/Environmental Issues.........................................30
d. Charitable Issues...................................................30
e. Political Issues....................................................30

12. ACTIVISM............................................................30-32
a. Shareholder Activism and Company Engagement.........................30
b. Activism Policy..................................................31-32

13. SUSTAINABILITY......................................................32-33
a. Sustainability Statement............................................32
b. Sustainability Policy............................................32-33

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PART II.B: EUROPE, MIDDLE EAST, AFRICA, CENTRAL AMERICA AND
------------------------------------------------
SOUTH AMERICA GUIDELINES
------------------------

1. REPORTS & ACCOUNTS
1A. ANNUAL REPORT
Reports and accounts should be both detailed and transparent, and should be
submitted to shareholders for approval. They should meet accepted reporting
standards, and company accounts should employ Generally Accepted Accounting
Practices (GAAP). Reports should meet with the spirit as well as the letter
of reporting standards, including the most recent recommendations of the
International Accounting Standards Board (IASB).

The annual report should include a statement of compliance with relevant
codes of best practice, in markets where they exist. For UK companies, a
statement of compliance with the Combined Code should be made, together
with detailed explanations regarding any area of non-compliance.

Legal disclosure varies from market to market. If, in our opinion, a
company's standards of disclosure (while meeting minimum legal
requirements) are insufficient in any particular area, we will inform
company management of our concerns. Depending on the circumstances, we will
either abstain or vote against the resolution concerned. Similar
consideration would relate to the use of inappropriate accounting methods.

1B. REMUNERATION REPORT
The remuneration policy as it relates to senior management should be
presented to shareholders as a separate voting item. We would expect the
report to contain full details of all aspects of executive directors'
emoluments. We will endeavour to engage with the company or seek an
explanation regarding any areas of remuneration which fall outside our
guidelines and we will abstain or vote against the remuneration report if
we feel that the explanation is insufficient.

SEE EXECUTIVE DIRECTOR REMUNERATION

2. DIVIDENDS
Proposals for the payment of dividends should be presented to shareholders
for approval, and should be fully disclosed in advance of the meeting. We
will vote against dividend proposals if the earnings and cash cover are
inadequate and we feel that payment of the proposed dividend would
prejudice the solvency or future prospects of the company.

3. AUDITORS
3A. AUDITOR INDEPENDENCE
Auditors must provide an independent and objective check on the way in
which the financial statements have been prepared and presented. JPMF will
vote against the appointment or reappointment of auditors who are not
perceived as being independent. The length of time both the audit company
and the audit partner have served in their capacity with a given company
may be a factor in determining independence.

3B. AUDITOR REMUNERATION
Companies should be encouraged to distinguish clearly between audit and
non-audit fees. Audit Committees should keep under review the non-audit
fees paid to the auditor, both in relation to the size of the total audit
fee and in relation to the company's total expenditure on consultancy, and
there should be a mechanism in place to ensure that consultancy work is put
out to competitive tender.

We would oppose non-audit fees consistently exceeding audit fees, where no
explanation was given to shareholders. Audit fees should never be
excessive.

SEE AUDIT COMMITTEE

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4. BOARDS
4A. CHAIRMAN & CEO
The Combined Code states that there should be a clear division of
responsibilities at the head of a company, such that no one individual has
unfettered powers of decision. JPMF believes that the roles of Chairman and
Chief Executive Officer should normally be separate. JPMF will generally
vote against combined posts.

4B. BOARD STRUCTURE
JPMF is in favour of unitary boards of the type found in the UK, as opposed
to tiered board structures. We agree with the Combined Code, which finds
that unitary boards offer flexibility while, with a tiered structure, there
is a risk of upper tier directors becoming remote from the business, while
lower tier directors become deprived of contact with outsiders of wider
experience. No director should beded from the requirement to submit
him/herself for reelection on a regular basis.

JPMF will generally vote to encourage the gradual phasing-out of tiered
board structures, in favour of unitary boards. However, tiered boards are
still very prevalent in markets outside the UK and local market practice
will always be taken into account.

4C. BOARD SIZE
Boards with more than 20 directors are deemed excessively large, and JPMF
will exercise its voting powers in favour of reducing large boards wherever
possible.

4D. BOARD INDEPENDENCE
JPMF believes that a strong independent element to a board is essential to
the effective running of a company. The Combined Code states that the
calibre and number of non-executive directors on a board should be such
that their views will carry significant weight in the board's decisions.

We agree with the ICGN, and the findings of the Higgs Review, that the
majority of a board of directors should be independent, especially if the
company has a joint Chairman/CEO. However, as a minimum, all boards should
have at least three independent non-executive directors, unless the company
is of such a size that sustaining such a number would be an excessive
burden.

JPMF will use its voting powers to encourage appropriate levels of board
independence, taking into account local market practice.

SEE NON EXECUTIVE DIRECTORS

4E. BOARD COMMITTEES
Where appropriate, boards should delegate key oversight functions to
independent committees. The Chairman and members of any Committee should be
clearly identified in the annual report.

(I) NOMINATION COMMITTEE
There should be a formal nomination process for the appointment
of Directors with both executive and non-executive
representation. Nomination Committees should be
majority-independent.

(II) REMUNERATION COMMITTEE
Boards should appoint Remuneration Committees consisting
exclusively of independent non-executive directors, with no
personal financial interest in relation to the matters to be
decided, other than their fees and their shareholdings.
Non-executive directors should have no potential conflicts of
interest arising from cross-directorships and no day-to-day
involvement in the running of the business. We would oppose the
re-election of any non- executive director who, in our view, had
failed to exercise sound judgement on remuneration issues.

Responsibility for the remuneration report (where applicable)
should lie with the Remuneration Committee.

SEE REMUNERATION REPORT

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4E. BOARD COMMITTEES - CONTINUED

(III) AUDIT COMMITTEE

An Audit Committee should be established consisting solely of
non-executive directors, who should be independent of management.
The Committee should include at least one person with appropriate
financial qualifications but they should all undergo appropriate
training that provides and maintains a reasonable degree of
up-to-date financial literacy and there should be written terms
of reference which deal clearly with their authority and duties.
Formal arrangements should be in place for the Committee to hold
regular meetings with external auditors, without executive or
staff presence, and they should have an explicit right of
unrestricted access to company documents and information. The
Committee should have the authority to engage independent
advisers where appropriate and also should have responsibility
for selecting and recommending to the board, the external
auditors to be put forward for appointment by the shareholders in
general meeting. The Committee should monitor and review the
scope and results of internal audit work on a regular basis. The
Committee should be able to give additional assurance about the
quality and reliability of financial information used by the
board and public financial statements by the company.

5. DIRECTORS
5A. DIRECTORS' CONTRACTS
JPMF believes that there is a strong case for directors' contracts being of
one year's duration or less. This is in line with the findings of recent UK
Government committees as well as the view of the NAPF and ABI. However,
JPMF always examines these issues on a case-by-case basis and we are aware
that there will occasionally be a case for contracts of a longer duration
in exceptional circumstances, in order to secure personnel of the required
calibre.

Generally, we encourage contracts of one year or less and vote accordingly.
Unless the Remuneration Committee gives a clearly-argued reason for
contracts in excess of one year, we will vote against the re-election of
any director who has such a contract, as well as consider the re- election
of any director who is a member of the Remuneration Committee.

Directors' contracts increasingly contain special provisions whereby
additional payment becomes due in the event of a change of control. We
agree with the view of the NAPF and ABI that such terms are inappropriate
and should be discouraged and, under normal circumstances, we will use our
voting power accordingly.

Market practice globally regarding the length of directors' service
contracts varies enormously, and JPMF is cognisant that it would be
inappropriate to enforce UK standards in some other markets. To this end,
JPMF takes into account local market practice when making judgements in
this area.

5B. EXECUTIVE DIRECTOR REMUNERATION
Executive remuneration is, and will remain, a contentious issue,
particularly the overall quantum of remuneration. However, company policy
in this area cannot be prescribed by any code or formula to cater for all
circumstances and must depend on responsible and well-informed judgement on
the part of Remuneration Committees. Any remuneration policy should be
transparent and fully disclosed to shareholders in a separate Remuneration
Report within the Annual Report.

JPMF will generally vote against shareholder proposals to restrict
arbitrarily the compensation of executives or other employees. We feel that
the specific amounts and types of employee compensation are within the
ordinary business responsibilities of the board and the company management.
However, the remuneration of executive directors should be determined by
independent Remuneration Committees and fully disclosed to shareholders.
Any stock option plans or long-term incentive plans should meet our
guidelines for such plans.

We strongly believe that directors should be encouraged to hold meaningful
amounts of company stock, equivalent to at least one year's salary, in
order to align fully their interests with the interests of shareholders.

SEE STOCK OPTIONS AND LONG-TERM INCENTIVE PLANS (L-TIPS)

SEE REMUNERATION REPORT

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5C. DIRECTOR LIABILITY
In certain markets, this proposal asks shareholders to give blanket
discharge from responsibility for all decisions made during the previous
financial year. Depending on the market, this resolution may or may not be
legally binding, and may not release the board from its legal
responsibility.

JPMF will usually vote against discharging the board from responsibility in
cases of pending litigation, or if there is evidence of wrongdoing for
which the board must be held accountable.

5D. DIRECTORS OVER 70
While special requirements for directors over 70 have their roots in
company legislation (in the UK) as well as various corporate governance
guidelines, JPMF considers that a similar standard of care should be
applied to the selection of a director over 70 as would be applied to that
of any other director, although we would expect to see such a director
offer himself or herself for re-election each year.

6. NON-EXECUTIVE DIRECTORS
6A. ROLE OF NON-EXECUTIVE DIRECTORS
As stated earlier in these guidelines, JPMF believes that a strong
independent element to a board is essential to the effective running of a
company. We will use our voting power to ensure that a healthy independent
element to the board is preserved at all times and to oppose the
re-election of non- executive directors whom we no longer consider to be
independent.

In determining our vote, we will always consider independence issues on a
case-by-case basis, taking into account any exceptional individual
circumstances, together with local markets' differing attitudes to director
independence.

In order to help assess their contribution to the company, the time spent
by each non-executive director should be disclosed to shareholders, as well
as their attendance at board and committee meetings.

Audit and Remuneration Committees should be composed exclusively of
independent directors.

6B. DIRECTOR INDEPENDENCE
We agree with the ICGN that a director will generally be deemed to be
independent if he or she has no significant financial, familial or other
ties with the company which might pose a conflict, and has not been
employed in an executive capacity by the company for at least the previous
ten years.

A non-executive director who has served more than three terms (or ten
years) in the same capacity can no longer be deemed to be independent.

6C. NON-EXECUTIVE DIRECTOR REMUNERATION
JPMF strongly believes that non-executive directors should be paid, at
least in part, in shares of the company wherever possible, in order to
align their interests with the interests of shareholders. Performance
criteria, however, should never be attached. Non-executive directors should
not be awarded options.

6D. MULTIPLE DIRECTORSHIPS

In order to be able to devote sufficient time to his or her duties, we
would not normally expect a non- executive to hold more than five
significant directorships at any one time. For executives, only one
additional non-executive post would normally be considered appropriate
without further explanation.

We agree with the findings of the Higgs Report in the UK that no single
individual should chair more than one major listed company.

6E. INVESTMENT TRUST DIRECTORS

In the UK, the boards of investment trust companies are unusual in being
normally comprised solely of non-executive directors, the majority of whom
are independent of the management company. We believe this to be
appropriate and expect boards to comply with the Combined Code, except
where such compliance is clearly inappropriate (e.g. Nomination
Committees). Given the highly specialised nature of these companies it is
particularly important that the board contains the correct mix of skills
and experience.

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7. ISSUE OF CAPITAL
7A. ISSUE OF EQUITY
In most countries, company law requires that shareholder approval be
obtained in order to increase the authorised share capital of the company.
Proposals for equity issues will also specify whether pre-emptive rights
are to be retained or suppressed or partially suppressed for the issue. As
a general rule, JPMF believes that any new issue of equity should first be
offered to existing shareholders on a pre-emptive basis.

JPMF will vote in favour of increases in capital which enhance a company's
long-term prospects. We will also vote in favour of the partial suspension
of pre-emptive rights if they are for purely technical reasons (e.g. rights
offers which may not be legally offered to shareholders in certain
jurisdictions).

JPMF will vote against increases in capital which would allow the company
to adopt "poison pill" takeover defence tactics, or where the increase in
authorised capital would dilute shareholder value in the long term.

7B. ISSUE OF DEBT
Reasons for increased bank borrowing powers are many and varied, including
allowing normal growth of the company, the financing of acquisitions, and
allowing increased financial leverage. Management may also attempt to
borrow as part of a takeover defence.

JPMF will vote in favour of proposals which will enhance a company's
long-term prospects. We will vote against an increase in bank borrowing
powers which would result in the company reaching an unacceptable level of
financial leverage, where such borrowing is expressly intended as part of a
takeover defence, or where there is a material reduction in shareholder
value.

7C. SHARE REPURCHASE PROGRAMMES
Boards may instigate share repurchase or stock buy-back programs for a
number of reasons. JPMF will vote in favour of such programmes where the
repurchase would be in the best interests of shareholders, and where the
company is not thought to be able to use the cash in a more useful way.

We will vote against such programmes when shareholders' interests could be
better served by deployment of the cash for alternative uses, or where the
repurchase is a defensive manoeuvre or an attempt to entrench management.

8. MERGERS/ACQUISITIONS
Mergers and acquisitions are always reviewed on a case-by-case basis by the
investment analyst in conjunction with portfolio managers and, in
exceptional circumstances, the Proxy Committee. Individual circumstances
will always apply. However, as a general rule, JPMF will favour mergers and
acquisitions where the proposed acquisition price represents fair value,
where shareholders cannot realise greater value though other means, and
where all shareholders receive fair and equal treatment under the
merger/acquisition terms.

9. VOTING RIGHTS
JPMF believes in the fundamental principle of "one share, one vote."
Accordingly, we will vote to phase out dual voting rights or classes of
share with restricted voting rights, and will oppose attempts to introduce
new ones. We are opposed to mechanisms that skew voting rights, such as
cumulative voting; directors should represent all shareholders equally, and
voting rights should accrue in accordance with the shareholder's equity
capital commitment to the company.

Similarly, we will generally oppose amendments to require supermajority
(i.e. more than 51%) votes to approve mergers, consolidations or sales of
assets or other business combinations.

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10. SHARE OPTIONS/LONG-TERM INCENTIVE PLANS (L-TIPS)
10A. SHARE OPTIONS
Share option schemes should be clearly explained and fully disclosed to
both shareholders and participants, and put to shareholders for approval.
Each director's share options should be detailed, including exercise
prices, expiry dates and the market price of the shares at the date of
exercise. They should take into account maximum levels of dilution, as set
out in ABI, NAPF and similar guidelines. Full details of any performance
criteria should be included. Share options should never be issued at a
discount, and there should be no award for below-median performance. In
general, JPMF will vote in favour of option schemes, the exercise of which
requires that challenging performance criteria be met.

Best practice requires that share options be fully expensed, so that
shareholders can assess their true cost to the company. The assumptions and
methodology behind the expensing calculation should also be explained to
shareholders.

We will generally vote against the cancellation and reissue, retesting or
repricing, of underwater options.

10B. LONG-TERM INCENTIVE PLANS (L-TIPS)
A Long-Term Incentive Plan ("L-TIP") can be defined as any arrangement,
other than deferred bonuses and retirement benefit plans, which require one
or more conditions in respect of service and/or performance to be satisfied
over more than one financial year.

JPMF, in agreement with the stipulations of the Combined Code, feels that
the performance-related elements of any L-TIP should be designed to give
directors keen incentives to perform at the highest levels, and that grants
under such schemes should be subject to performance criteria which are
challenging and which reflect the company's objectives.

Ideally, the L-TIP should use a methodology such as total shareholder
return ("TSR"), coupled with a financial underpin such as growth in
earnings per share ("EPS"). Performance should be benchmarked against an
appropriate comparator group of companies and a graph of recent performance
should be included. Awards should increase on a straight-line basis, with a
maximum award only vesting for the very highest performance. As with share
option schemes, there should be no award for below-median performance. Any
beneficiary should be encouraged to retain any resultant shares for a
suitable time.

In all markets JPMF will vote in favour of schemes with keen incentives and
challenging performance criteria, which are fully disclosed to shareholders
in advance, and vote against payments which are excessive or performance
criteria which are undemanding. We would expect Remuneration Committees to
explain why criteria are considered to be challenging and how they align
the interests of shareholders with the interests of the recipients.

11. OTHERS
11A. POISON PILLS
Poison pills, or shareholder rights plans, are designed to give
shareholders of a target company the right to purchase shares of the
acquiring company, the target company, or both at a substantial discount
from market value. These rights are exercisable once a predefined
"triggering event" occurs, generally a hostile takeover offer or an
outsider's acquisition of a certain percentage of stock. Corporations may
or may not be able to adopt poison pills without shareholder approval,
depending on the market.

In reaching its voting position, the Committee has reviewed and continues
to review current takeover events. However, it has concluded that there is
no clear evidence that poison pills deter takeover offers or defeat
takeover attempts, and are, in fact, sometimes used as tools to entrench
management.

JPMF will generally vote against anti-takeover devices and support
proposals aimed at revoking existing plans. Where anti-takeover devices
exist, they should be fully disclosed to shareholders and shareholders
should be given the opportunity to review them periodically.

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11B. COMPOSITE RESOLUTIONS
Agenda items at shareholder meetings should be presented in such a way that
they can be voted upon clearly, distinctly and unambiguously. We normally
oppose deliberately vague, composite or "bundled" resolutions, depending on
the context.

11C. SOCIAL/ENVIRONMENTAL ISSUES
The Committee reviews shareholder proposals concerning social and
environmental issues. In normal circumstances, the consideration of social
issues in investment decisions is the duty of directors; nevertheless, from
time to time, a company's response to the circumstances of a particular
social or environmental issue may have economic consequences, either
directly or indirectly. In these cases, the economic effects are considered
in determining our vote.

Where management is proposing changes with a social, environmental or
ethical dimension, these proposals should be in line with JPMF's
Sustainability Policy.

SEE SUSTAINABILITY

11D. CHARITABLE ISSUES
Charitable donations are generally acceptable, provided they are within
reasonable limits and fully disclosed to shareholders.

11E. POLITICAL ISSUES
JPMF does not normally support the use of shareholder funds for political
donations, and would require the fullest explanation as to why this would
be beneficial to shareholders.

12. ACTIVISM
12A. SHAREHOLDER ACTIVISM AND COMPANY ENGAGEMENT
In November 2002, the Institutional Shareholders' Committee ("ISC"),
comprising the trade bodies of the UK's investing institutions, published a
Statement of Principles which sets out the responsibilities of
institutional shareholders in respect of investee companies. JPMF endorses
the ISC Principles, which are set out below:

"Institutional shareholders and/or agents in relation to their
responsibilities in respect of investee companies ... will:

o set out their policy on how they will discharge their responsibilities
- clarifying the priorities attached to particular issues and when
they will take action

o monitor the performance of and establish, where necessary, a regular
dialogue with investee companies

o intervene where necessary

o evaluate the impact of their activism

o report back to clients/beneficial owners"

It is important to note that the above only applies in the case of UK
companies, irrespective of their market capitalisation, although there will
be occasions when intervention is not appropriate for reasons of
cost-effectiveness or practicability. However, JPMF will continue to
intervene outside the UK where we believe this to be necessary in order to
protect our clients' interests.

The full text of the Principles is available from JPMF or it can be found
on the Investment Management Association web-site (www.investmentuk.org)

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12B. ACTIVISM POLICY
(I) DISCHARGE OF RESPONSIBILITIES
a) Our primary responsibility is to protect our clients'
interests and, as active managers, we therefore absolutely
reserve the right to dispose of an investment where a
company fails to meet our expectations.

b) Our investment managers and analysts have explicit
responsibilities for monitoring the companies in the
universe of stocks from which clients' portfolios are
constructed. While we attach considerable importance to
meetings with management (and several hundred take place in
the UK each year), we also emphasise the benefits of
fundamental research into companies in our investment
processes. Industry research, balance sheet analysis and
company news flow all have a role to varying degrees in our
company monitoring.

c) As noted in our Corporate Governance Guidelines we expect
companies to comply with the standards of corporate
governance set out in the Combined Code and will use our
votes to encourage compliance.

d) Where appropriate, we will engage with companies in which
client assets are invested if they fail to meet our
requirements with regard to corporate governance and/or
performance. Engagement on corporate governance issues such
as remuneration and board structures is ongoing and does not
only occur at the time of an AGM. Performance issues where
more active intervention is appropriate will include failure
to achieve strategic targets for the development of the
business or perceived weaknesses in the management
structure. The approach involves active discussion with
company management and directors and, if necessary,
participation in action groups, but not direct involvement
in management.

e) Our approach to dealing with conflicts of interest is
described fully in our Corporate Governance Policies and
Procedures. We seek to minimise conflicts by controlling
information flows between different parts of JPMorgan Chase.
Where a material conflict does arise we require investors
who make the voting decision to certify that they have acted
solely in the clients' best interests.

f) Our policy is to vote at all UK company meetings on behalf
of all clients where we have authority to do so.

(II) MONITOR PERFORMANCE
As noted above the monitoring of company performance is a key
part of our investment processes. Our voting records are
available to clients and serve to demonstrate, among other
things, our support or otherwise for a company's board structure
and remuneration policies. All votes against company management
are minuted and signed off by the Proxy Committee. In addition we
maintain a log of all private meetings held with companies. We
regard these meetings as confidential and will not comment on
them outside JPMF.

(III) INTERVENING WHERE NECESSARY
a) As we have an active approach to proxy voting we do, in one
sense, intervene frequently in company affairs and will vote
against or abstain on resolutions at company meetings where
we believe it to be in the best interests of our clients.
Whenever we intend to vote against management, we speak with
the company in order to ensure that they are fully informed
of the reasons for the policy to which we are opposed and to
give management an opportunity to amend that policy. The
evidence is that by consistently seeking compliance with
best practice we do, over time, influence company behaviour.

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12B. ACTIVISM POLICY - CONTINUED

b) JPMF does not intervene directly in the management of
companies. However, we will arrange to meet with senior
management where a company has failed to meet our
expectations, but we believe that the potential of the
company still justifies retention in our clients'
portfolios. On such occasions we expect management to
explain what is being done to bring the business back on
track. If possible we try to avoid being made insiders as
this constrains our ability to deal in the stock. In the
small capitalisation end of the market, more aggressive
intervention is more common, but still infrequent, as we may
hold a significant percentage of a company's equity. In such
circumstances we will frequently raise our concerns first
with the company's brokers or advisers.

(IV) EVALUATING AND REPORTING

We are convinced that a strong governance culture leads
ultimately to a better business and a better stock market rating.
As investors we scrutinise companies' governance policies as a
part of our investment research and take comfort from good
governance. Thus, one measure of success of our monitoring is the
extent to which our investment strategy achieves our clients'
investment objectives. Where we have pushed for change, either in
governance policies or in business strategy, we measure success
by the extent that change is forthcoming and whether our clients
benefit as a result.

Reports detailing our engagement activity are available to
clients on a quarterly basis.

13. SUSTAINABILITY
13A. SUSTAINABILITY STATEMENT

From 3rd July 2000, trustees of occupational pension schemes in the UK have
been required to disclose their policy on Corporate Social Responsibility
("CSR") in their Statement of Investment Principles.

JPMF has had experience of tailoring portfolios to meet individual ethical
requirements for over fifty years. We believe that we operate to the
highest standards and that our ethical screens will meet the requirements
of most clients. For pension fund clients, who are not permitted to exclude
specific areas of investment from their portfolios, we have developed a
number of strategies to positively target companies with superior social,
ethical and environmental credentials.

For institutional clients such as charitable foundations and endowments,
where the legal framework for ethical and socially responsible investing is
less restrictive, JPMF has substantial experience over a long period of
time of managing ethically-constrained portfolios. This service is
client-preference led and flexible, and forms part of our charitable sector
specialist investment services.

For clients who have not specified individual social or environmental
criteria in their guidelines, these issues are still taken into account by
analysts and portfolio managers as part of the overall stock selection
process, and certain engagement activity is still undertaken by JPMF on
their behalf. This is detailed in the following section.

13B. SUSTAINABILITY POLICY
Where JPMF engages with companies on broader sustainability issues, we have
adopted a positive engagement approach. Thus, specific assets or types of
assets are not excluded on purely social, environmental or ethical criteria
(unless specifically requested by clients). Rather, analysts take such
issues into account as part of the mainstream analytical process. Where
appropriate, JPMF will also engage with company management on specific
issues at company one-to-one meetings. This engagement activity can then be
reported to clients as required.

Where sustainability issues are the subject of a proxy vote, JPMF will
consider the issue on a case- by-case basis, keeping in mind at all times
the best economic interests of our clients. Increasingly, shareholder
proposals are being used by activist groups to target companies as a means
of promoting single-issue agendas. In these instances, it is important to
differentiate between constructive resolutions, intended to bring about
genuine social or environmental improvement, and hostile proposals intended
to limit management power, which may in fact ultimately destroy shareholder
value.

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13B. SUSTAINABILITY POLICY - CONTINUED

In formulating our Sustainability Policy, we have endeavoured not to
discriminate against individual companies or sectors purely on the grounds
of the particular business sector in which they are involved. Thus a
company in an extractive industry or the defence industry will not be
automatically marked down because their sector is perceived as
"unfriendly." Similarly, a company in a low-impact industry such as
financial services will still be expected to have in place detailed
policies and rigorous oversight of its environmental impact. JPMF is
committed to improving standards of CSR among all of the companies in which
it invests its clients' assets as part of an inclusive positive engagement
strategy. We would normally expect companies to publish a statement on CSR
within their Annual Report, or to provide a separate CSR report to
shareholders.

The current focus of this engagement process is on UK companies. However,
social and environmental issues are taken into account for overseas
companies on a wider basis where appropriate as described previously. It is
anticipated that our sustainability program will continue to expand both in
terms of scope and market coverage as client demand and availability of
suitable resources dictate.

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PART II.C: ASIA (EX-JAPAN) PROXY VOTING
---------------------------------------

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PART II.C: ASIA EX-JAPAN PROXY VOTING GUIDELINES
------------------------------------------------
TABLE OF CONTENTS
-----------------

I PRINCIPLES..............................................................36

II POLICY AND PROCEDURES................................................37-38
1. Proxy Committee......................................................37
2. Voting...............................................................37
3. Engagement...........................................................37
4. Conflicts of Interest................................................38

III VOTING GUIDELINES....................................................38-42
1. Reports & Accounts...................................................38
2. Dividends............................................................38
3. Auditors.............................................................38
4. Boards...............................................................39
5. Directors............................................................39
6. Non-Executive Directors..............................................40
7. Issue of Capital..................................................40-41
8. Mergers/Acquisitions.................................................41
9. Voting Rights........................................................41
10. Share Options/Long-Term Incentive Plans (L-TIPs)....................41
11. Others..............................................................41

IV ACTIVISM................................................................42

V SUSTAINABILITY..........................................................42

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PART II.C: ASIA EX-JAPAN PROXY VOTING GUIDELINES
------------------------------------------------

I. PRINCIPLES

JF ASSET MANAGEMENT ("JFAM") is committed to delivering superior investment
performance to its clients worldwide. We believe that one of the drivers of
investment performance is an assessment of the corporate governance
principles and practices of the companies in which we invest our clients'
assets and we expect those companies to demonstrate high standards of
governance in the management of their business.

We have set out below the principles which provide the framework for our
corporate governance activity. Although the policies and guidelines set out
in this document apply to Hong Kong and therefore principally concern
accounts managed from the Hong Kong office, our colleagues in London, New
York and Tokyo have similar standards, consistent with law and best
practice in these different locations.

1. FIDUCIARY PRIORITY. Our clients appoint us to manage their assets in
order to maximise the likelihood of meeting or exceeding their
investment objectives at acceptable risk levels. Every decision to
buy, hold or sell any security will be consistent with that overriding
objective.

2. EVALUATION. Our clients expect us, as their delegates, to monitor the
governance of companies in which we have invested their assets.

3. ENGAGEMENT. We encourage excellence in the management of companies
through the considered application of our corporate governance
policies and guidelines. We welcome consultation by companies with
their leading shareholders on corporate governance issues.

4. PROXY VOTING. Company management is accountable to the shareholders,
our clients. It is our responsibility to ensure this is recognised
through the considered use of our clients' votes.

5. LITIGATION AND JOINT WORKING PARTIES. JFAM will align itself with
other shareholders, for example, by joining class action suits or
working parties as local practice dictates, where we are convinced
that this is in the best interests of our clients.

6. DISCLOSURE. JFAM's corporate governance guidelines and policies are
available to clients and companies alike. We believe that they conform
to best practice and we are prepared to discuss them openly with other
interested parties.

7. ONGOING COMMITMENT. JFAM is committed to reviewing its corporate
governance principles, policies and guidelines to ensure that they
fully reflect our interpretation of best market practice.

JF ASSET MANAGEMENT
HONG KONG PROXY COMMITTEE

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II. POLICY and PROCEDURES

JF Asset Management ("JFAM") manages the voting rights of the shares
entrusted to it as it would manage any other asset. It is the policy of
JFAM to vote in a prudent and diligent manner, based exclusively on our
reasonable judgement of what will best serve the financial interests of the
beneficial owners of the security.

1. PROXY COMMITTEE

The Hong Kong Proxy Committee has been established to oversee the proxy
voting process in the Asia ex-Japan region on an ongoing basis. It is
composed of the Proxy Administrator and senior officers from the
Investment, Compliance and Risk Management Departments. The main functions
of the Proxy Committee are to review the Proxy Voting Guidelines to ensure
they are aligned with best practice; and to provide advice and
recommendations on general proxy voting matters as well as on specific
voting issues as they occur. The Proxy Committee may delegate certain of
its responsibilities to subgroups composed of Proxy Committee members. It
meets quarterly, or more frequently as circumstances dictate and its
minutes are circulated to senior management including the Asia Risk
Committee to whom it reports.

2. VOTING

As these Guidelines represent what we consider to be in the best financial
interests of our clients, we would normally expect clients to allow us to
use them as a template for voting. However, we recognise that in certain
circumstances further analysis may be required.

In view of our overriding fiduciary duty to act in the best interest of our
clients, the Guidelines are an indication only of JFAM's voting policy. The
portfolio manager has discretion to override the policy should individual
circumstances dictate.

Our Guidelines are primarily targeted at companies listed on main stock
exchanges. It is sometimes difficult for smaller companies to apply the
same corporate governance standards and we would look at any issues for
such companies on a case-by-case basis. We would, however, encourage them
to apply the highest possible standards of governance.

For markets in Asia ex-Japan, we will generally abstain from voting at AGMs
on the grounds that the matters normally considered at such meetings are of
a routine and non-contentious nature. To ensure we fulfil our fiduciary
obligation to always act in our clients' best interests, we will review
each AGM notice to check whether there are any non-routine matters such as
company reorganisations/restructurings, takeover/merger and senior
management compensation plans included therein. If any such matters are
identified then we will consider each one individually so that our clients'
best interests are served. Also, certain markets require that shares are
blocked from trading in order to be tendered for voting purposes. In these
instances, it may be in our clients' best interests to abstain from voting
in order to preserve the ability to trade. For these countries, a decision
will be taken on a case-by-case basis by the research analyst in
conjunction with the portfolio manager in order to determine how our
clients' best interests are served.

Situations can sometimes arise where more than one JFAM client invests in
the same company or in which a single client may invest in the same company
but in multiple accounts. In those situations, two or more clients, or one
client with different accounts, may be invested in strategies having
different investment objectives, investment styles, or portfolio managers.
As a result, JFAM may cast different votes on behalf of different clients
or on behalf of the same client with different accounts.

3. ENGAGEMENT

We regard regular, systematic and direct contact with senior company
management, both executive and non-executive, as crucially important. We
consider that these dialogues have been useful and plan to expand this
approach.

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4. CONFLICTS OF INTEREST

In order to maintain the integrity and independence of JFAM's proxy-voting
decisions, JPMorgan Chase (including JPMFAM) has established formal
barriers designed to restrict the flow of information between JPMC's
securities, lending, investment banking and other divisions to JPMFAM
investment professionals.

Where a potential material conflict of interest has been identified, the
Proxy Administrator, in consultation with the Proxy Committee, evaluates
the potential conflict and determines whether an actual conflict exists. In
the event that this is the case, they make a recommendation on how to vote
the proxy. A record of such decisions is available to clients on request.

Finally, it should be pointed out that this document is intended as an
overview only. Specific issues should always be directed to your account
administrator or portfolio manager.

III. VOTING GUIDELINES

1. REPORTS & ACCOUNTS

1A. ANNUAL REPORT

Reports and accounts should be both detailed and transparent, and should be
submitted to shareholders for approval. They should meet accepted reporting
standards, and company accounts should employ Generally Accepted Accounting
Practices (GAAP). Reports should meet with the spirit as well as the letter
of reporting standards, including the most recent recommendations of the
International Accounting Standards Board (IASB).

The annual report should include a statement of compliance with relevant
codes of best practice, in markets where they exist.

Legal disclosure varies from market to market. If, in our opinion, a
company's standards of disclosure (whilst meeting minimum legal
requirements) are insufficient in any particular area, we will inform
company management of our concerns. Depending on the circumstances, we will
either abstain or vote against the resolution concerned. Similar
consideration would relate to the use of inappropriate accounting methods.

2. DIVIDENDS

Proposals for the payment of dividends should be presented to shareholders
for approval, and should be fully disclosed in advance of the meeting. We
will vote against dividend proposals if we feel that payment of the
proposed dividend would prejudice the solvency or future prospects of the
company.

3. AUDITORS

3A. AUDITOR INDEPENDENCE

Auditors must provide an independent and objective check on the way in
which the financial statements have been prepared and presented. JFAM will
vote against the appointment or re- appointment of auditors who are not
perceived as being independent.

3B. AUDITOR REMUNERATION

Companies should be encouraged to distinguish clearly between audit and
non-audit fees. Audit fees should never be excessive.

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4. BOARDS

4A. CHAIRMAN & CEO

JFAM believes that it is best practice for the roles of Chairman and Chief
Executive Officer to be separate.

4B. BOARD STRUCTURE

JFAM is in favour of unitary boards of the type found in Hong Kong, as
opposed to tiered board structures.

4C. BOARD SIZE

Boards with more than 20 directors are considered to be excessively large.

4D. BOARD INDEPENDENCE

JFAM believes that a strong independent element to a board is essential to
the effective running of a company. The calibre and number of non-executive
directors on a board should be such that their views will carry significant
weight in the board's decisions.

We believe that as a minimum, all boards should have at least three
non-executive directors, unless the company is of such a size that
sustaining such a number would be an excessive burden.

JFAM will use its voting powers to encourage appropriate levels of board
independence, taking into account local market practice.

4E. BOARD COMMITTEES

Where appropriate, boards should delegate key oversight functions to
independent committees. The Chairman and members of any Committee should be
clearly identified in the annual report.

5. DIRECTORS

5A. EXECUTIVE DIRECTOR'S REMUNERATION

Executive remuneration is and will remain a contentious issue, particularly
the overall quantum of remuneration.

JFAM will generally vote against shareholder proposals to restrict
arbitrarily the compensation of executives or other employees.

5B. DIRECTOR'S LIABILITY

In certain markets, this proposal asks shareholders to give blanket
discharge from responsibility for all decisions made during the previous
financial year. Depending on the market, this resolution may or may not be
legally binding, and may not release the board from its legal
responsibility.

JFAM will usually vote against discharging the board from responsibility in
cases of pending litigation, or if there is evidence of wrongdoing for
which the board must be held accountable.

5C. DIRECTORS OVER 70

JFAM considers that a similar standard of care should be applied to the
selection of a director over 70 as would be applied to that of any other
director, although we would expect to see such a director offer himself or
herself for re-election each year.

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6. NON-EXECUTIVE DIRECTORS

6A. ROLE OF NON-EXECUTIVE DIRECTORS

As stated earlier in these guidelines, JFAM believes that a strong
independent element to a board is important to the effective running of a
company.

Audit and Remuneration Committees should be composed exclusively of
independent directors.

6B. DIRECTOR INDEPENDENCE

We consider that a director will generally be deemed to be independent if
he or she has no significant financial, familial or other ties with the
company which might pose a conflict, and has not been employed in an
executive capacity by the company for at least the previous ten years.

6C. MULTIPLE DIRECTORSHIPS

In order to be able to devote sufficient time to his or her duties, we
would not normally expect a non-executive to hold more than five
significant directorships at any one time. For executives, only one
additional non-executive post would normally be considered appropriate
without further explanation.

7. ISSUE OF CAPITAL

7A. ISSUE OF EQUITY

In most countries, company law requires that shareholder approval be
obtained in order to increase the authorised share capital of the company.
Proposals for equity issues will also specify whether pre-emptive rights
are to be retained or suppressed or partially suppressed for the issue. As
a general rule, JFAM believes that any new issue of equity should first be
offered to existing shareholders on a pre-emptive basis.

JFAM will vote in favour of increases in capital which enhance a company's
long-term prospects.

7B. ISSUE OF DEBT

Reasons for increased bank borrowing powers are many and varied, including
allowing normal growth of the company, the financing of acquisitions, and
allowing increased financial leverage. Management may also attempt to
borrow as part of a takeover defence.

JFAM will vote in favour of proposals which will enhance a company's
long-term prospects. We will vote against an increase in bank borrowing
powers which would result in the company reaching an unacceptable level of
financial leverage, where such borrowing is expressly intended as part of a
takeover defence, or where there is a material reduction in shareholder
value.

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7C. SHARE REPURCHASE PROGRAMMES

Boards may instigate share repurchase or stock buy-back programs for a
number of reasons. JFAM will vote in favour of such programmes where the
repurchase would be in the best interests of shareholders, and where the
company is not thought to be able to use the cash in a more useful way.

8. MERGERS / ACQUISITIONS

Mergers and acquisitions are always reviewed on a case-by-case basis by the
investment analyst in conjunction with portfolio managers and, in
exceptional circumstances, the Proxy Committee. Individual circumstances
will always apply. However, as a general rule, JFAM will favour mergers and
acquisitions where the proposed acquisition price represents fair value,
where shareholders cannot realise greater value through other means, and
where all shareholders receive fair and equal treatment under the
merger/acquisition terms.

9. VOTING RIGHTS

JFAM believes in the fundamental principle of "one share, one vote".
Accordingly, we will vote to phase out dual voting rights or classes of
share with restricted voting rights, and will oppose attempts to introduce
new ones. We are opposed to mechanisms that skew voting rights, such as
cumulative voting; directors should represent all shareholders equally, and
voting rights should accrue in accordance with the shareholder's equity
capital commitment to the company.

10. SHARE OPTIONS / LONG-TERM INCENTIVE PLANS (L-TIPS)

10A. SHARE OPTIONS

We will generally vote against the cancellation and re-issue, re-pricing,
of underwater options.

10B. LONG-TERM INCENTIVE PLANS (L-TIPS)

A Long-Term Incentive Plan ("L-TIP") can be defined as any arrangement,
other than deferred bonuses and retirement benefit plans, which require one
or more conditions in respect of service and/or performance to be satisfied
over more than one financial year.

JFAM normally will vote in favour of schemes with keen incentives and
challenging performance criteria, which are fully disclosed to shareholders
in advance, and vote against payments which are excessive or performance
criteria which are undemanding.

11. OTHERS

11A. CHARITABLE ISSUES

Charitable donations are generally acceptable, provided they are within
reasonable limits and fully disclosed to shareholders.

11B. POLITICAL ISSUES

JFAM does not normally support the use of shareholder funds for political
donations, and would require the fullest explanation as to why this would
be beneficial to shareholders.

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IV. ACTIVISM

ACTIVISM POLICY

1. DISCHARGE OF RESPONSIBILITIES

a) Our primary responsibility is to protect our clients' interests and,
as active managers, we therefore absolutely reserve the right to
dispose of an investment where a company fails to meet our
expectations.

b) Our investment managers and analysts have explicit responsibilities
for monitoring the companies in the universe of stocks from which
clients' portfolios are constructed. Whilst we attach considerable
importance to meetings with management (and several hundred take place
in Asia ex-Japan each year), we also emphasise the benefits of
fundamental research into companies in our investment processes.
Industry research, balance sheet analysis and company news flow all
have a role to varying degrees in our company monitoring.

c) Our approach to dealing with conflicts of interest is described fully
in our Corporate Governance Policies and Procedures. We seek to
minimise conflicts by controlling information flows between different
parts of JPMorgan Chase. Where a material conflict does arise we
require investors who make the voting decision to certify that they
have acted solely in the clients' best interests.

2. MONITOR PERFORMANCE

Monitoring of company performance is a key part of our investment
processes. We maintain a record of all private meetings held with
companies. We regard these meetings as confidential and will not comment on
them outside JFAM.

3. EVALUATING AND REPORTING

V. SUSTAINABILITY

Where JFAM engages with companies on broader social, environmental and
sustainability issues, we have adopted a positive engagement approach.
Thus, specific assets or types of assets are not excluded on purely social,
environmental or ethical criteria (unless specifically requested by
clients). Rather, analysts take such issues into account as part of the
mainstream analytical process. Where appropriate, JFAM will also engage
with company management on specific issues at company one-to-one meetings.
This engagement activity can then be reported to clients as required.

Where social or environmental issues are the subject of a proxy vote, JFAM
will consider the issue on a case-by-case basis, keeping in mind at all
times the best financial interests of our clients.

It is anticipated that our SRI program will continue to expand both in
terms of scope and market coverage as client demand and availability of
suitable resources dictate.

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PART II.D: JAPAN PROXY VOTING
-----------------------------

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PART II.D: JAPAN PROXY VOTING GUIDELINES
----------------------------------------

1. NUMBER OF DIRECTORS
To ensure a swift management decision-making process, the appropriate
number of directors should be 20 or less.

2. DIRECTOR'S TENURE
Director's tenure should be equal to/less than 1 year.

3. DIRECTOR'S REMUNERATION
Remuneration of directors should generally be determined by an independent
committee.

4. AUDIT FEES
Audit fees must be at an appropriate level.

5. CAPITAL INCREASE
Capital increases will be judged on a case-by-case basis depending on its
purpose. Vote against capital increases if the purpose is to defend against
a takeover.

6. BORROWING OF FUNDS
Vote against abrupt increases in borrowing of funds if the purpose is to
defend against a takeover.

7. SHARE REPURCHASE PROGRAMS
Vote in favor of share repurchase programs if it leads to an increase in
the value of the company's shares.

8. PAYOUT RATIO
As a general rule, vote against any proposal for appropriation of profits
which involves a payout ratio of less than 50% (after taking into account
other forms of payouts to shareholders such as share repurchase programs)
if the capital ratio is equal to or greater than 50% and there is no
further need to increase the level of retained earnings.

9. MERGERS/ACQUISITIONS
Mergers and acquisitions must only be consummated at a price representing
fair value.

10. STOCK OPTIONS
Stock option programs should generally be publicly disclosed. Programs
which result in increases in remuneration despite declines in corporate
earnings (such as through a downward adjustment of the exercise price) is
generally not acceptable.

11. POLITICAL CONTRIBUTIONS
Do not approve any use of corporate funds for political activities.

12. ENVIRONMENTAL/SOCIAL ISSUES
Do not take into account environmental/social issues that do not affect the
economic value of the company.

JPMorgan Fleming Corporate Governance Page 44

ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not yet applicable.

ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.

REGISTRANT PURCHASES OF EQUITY SECURITIES

-------------------------------------------------------------------------------------------------------------------------
(C) TOTAL NUMBER OF SHARES (D) MAXIMUM NUMBER (OR
(A) TOTAL NUMBER (B) AVERAGE (OR UNITS) PURCHASED AS PART APPROXIMATE DOLLAR VALUE) OF SHARES
OF SHARES (OR PRICE PAID PER OF PUBLICLY ANNOUNCED PLANS OR UNITS) THAT MAY YET BE PURCHASED
PERIOD UNITS) PURCHASED SHARE (OR UNIT) OR PROGRAMS UNDER THE PLANS OR PROGRAMS
-------------------------------------------------------------------------------------------------------------------------

Month #1 NONE NONE NONE
7/1/04-
7/31/04
-------------------------------------------------------------------------------------------------------------------------
Month #2 NONE NONE NONE
8/1/04-
8/31/04
-------------------------------------------------------------------------------------------------------------------------
Month #3 NONE NONE NONE
9/1/04-
9/30/04
-------------------------------------------------------------------------------------------------------------------------
Month #4 NONE NONE NONE
10/1/04-
10/31/04
-------------------------------------------------------------------------------------------------------------------------
Month #5 NONE NONE NONE
11/1/04-
11/30/04
-------------------------------------------------------------------------------------------------------------------------
Month #6 NONE NONE NONE
12/1/04-
12/31/04
-------------------------------------------------------------------------------------------------------------------------
Total NONE NONE NONE

-------------------------------------------------------------------------------------------------------------------------

ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

There have been no material changes to the procedures by which the shareholders
may recommend nominees to the registrant's board of directors, where those
changes were implemented after the registrant last provided disclosure in
response to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR
240.14a-101), or this Item.

ITEM 11. CONTROLS AND PROCEDURES.

(a) The registrant's principal executive and principal financial officers,
or persons performing similar functions, have concluded that the
registrant's disclosure controls and procedures (as defined in Rule
30a-3(c) under the Investment Company Act of 1940, as amended (the
"1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within
90 days of the filing date of the report that includes the disclosure
required by this paragraph, based on their evaluation of these
controls and procedures required by Rule 30a-3(b) under the 1940 Act
(17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the
Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or
240.15d-15(b)).

(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act
(17 CFR 270.30a-3(d)) that occurred during the registrant's second
fiscal quarter of the period covered by this report that has
materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.

ITEM 12. EXHIBITS.

(a)(1) Code of ethics, or any amendment thereto, that is the subject of
disclosure required by Item 2 is attached hereto.

(a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and
Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.

(a)(3) Not applicable.

(b) Certifications pursuant to Rule 30a-2(b) under the 1940 Act and
Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.

(registrant) JF China Region Fund, Inc.
--------------------------------------------------------------

By (Signature and Title)* /s/ Simon Crinage
-------------------------------------------------
Simon Crinage, President
(principal executive officer)

Date March 10, 2005
----------------------------------------------------------------------

Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.

By (Signature and Title)* /s/ Simon Crinage
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Simon Crinage, President
(principal executive officer)

Date March 10, 2005
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By (Signature and Title)* /s/ Douglas Eu
-------------------------------------------------
Douglas Eu, Treasurer
(principal financial officer)

Date March 10, 2005
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* Print the name and title of each signing officer under his or her signature.