RNS Number : 4585C
  Sinosoft Technology plc
  01 September 2008
   



    Sinosoft Technology plc ("Sinosoft" or the "Company")
    Update on Outstanding Litigation

    As disclosed in Sinosoft's AIM Admission Document, Nanjing Skytech Limited ("Skytech"), a wholly-owned subsidiary of the Company, has
been engaged since 2004 in ongoing litigation with Janful Limited ("Janful"), a company incorporated in Hong Kong,  in relation to a joint
venture between Skytech and Janful which was dissolved prior to the Company being admitted to the AIM market.

    On 28 August 2008, Skytech received notification that an Arbitration Tribunal of the China International Economic & Trade Arbitration
Commission ("CIETAC") had found in favour of Janful and had instructed Skytech to pay an amount of the order of US$3.3m by way of
settlement.  In order to seek to enforce the arbitral award, Janful is required to apply for appropriate execution orders from the
Intermediate Court in Nanjing.

    The Board, having taken further legal advice continues to dispute the merits of Janful's claim.  Further, the Board does not believe
that the CIETAC has jurisdiction on this matter.  The Board intends to take action against this arbitral award by challenging the
jurisdiction of CIETAC and pursuing other legal avenues open to it as and when appropriate.

    Janful's arbitral award relates exclusively to the period prior to the Company's shares being admitted to AIM, and accordingly, after
consultation with the Board, Ms Xin Ying-Mei, Chief Executive Officer of the Company together with Mr Zhang Hong, Mr Ma Ming, Mr Wang
Xiao-gang and Mr Liu Biao (who together with Ms Xin Ying-Mei comprised certain of the founders of Skytech) have agreed to indemnify the
Company an amount equal to any liability the Group may incur as a consequence of any binding judgment or settlement agreement in relation to
this matter. Consequently the Board is of the view that the outstanding litigation will have no material impact on the financial position of
the Group, whatever its eventual outcome.

    The business of the Group continues to progress and the Board will provide an update on trading within the upcoming interim results.

    For further information, please visit www.sinosoft-technology.com or contact:

 Sinosoft Technology plc   Alfred Ho                  +(86) 25 8481 6867
 Hanson Westhouse Limited  Tim Metcalfe/Richard Baty       020 7601 6100

 Tavistock Communications  Simon Compton                   020 7920 3150







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