China Life Insurance (Group) Co. Ltd. (CLIC), the nation’s largest insurance group company, is intending to auction off its 51% equity holdings in the insurance joint venture, China CMG Life Insurance Co. Ltd., in compliance with a non-competition agreement signed with its subsidiary, China Life Insurance Co. Ltd. on Sep. 30, 2003.

According to the agreement, CLIC is not allowed to participate, operate or engage in any life, accident or health insurance or other businesses in China which may compete with China Life’s insurance businesses.

In addition, CLIC agreed to dispose all of its interests in the insurance joint venture to third parties or eliminate any competition between China CMG Life and China Life within three years from China Life’s New York and Hong Kong Listings at the end of December 2003.

A special equity transferring committee has been jointly set up by China CMG’s domestic and foreign shareholders - CLIC and the Commonwealth Bank of Australia.

The transfer is expected to be completed within this year.

According to the Securities Times citing an industry insider, Shougang Group will most likely take over the proposed transferring of shares from CLIC for at least RMB 300 million. China CMG’s spokesman has refused comment.

China CMG Life Insurance was formally launched in June 2000 with a registered capital of RMB 200 million. It is the first insurance firm to be jointly set up by an Australian company in China. The company collected almost RMB 290 million in premiums from its insurance products in 2006, according to the China Insurance Regulatory Commission (CIRC).