The Shenzhen Cyber Cafe Association has named China Security and Surveillance Technology Inc. as the exclusive surveillance system and service provider for Internet cafes in the southern Chinese city of Shenzhen.

There are approximately 1000 Internet cafes in Shenzhen City and the contract is estimated to yield in excess of US$3 million in revenue over the next 12 months.

According to Ordinance 458 issued January 18th, 2006 by the State Council, within one year of the initiation date of March 1, 2006, all entertainment halls in China must purchase video-monitoring systems covering entrances, exits and main corridors.

Due to the inability to control the vast amount of information that is accessible on the Internet, the government was recently forced to shut down a number of cafes. The new regulations will allow for better monitoring over explicit material and presumably allow the cafes to reopen.

"This Ordinance will expand the video surveillance industry into a new market vertical and provide incremental revenue opportunities," commented Mr. Tony Tu, chief executive officer of China Security and Surveillance Technology. "Beijing and Guangzhou, two of the largest cities in China in terms of population, are currently creating the necessary infrastructure required to support the growth of Internet cafes. China Security and Surveillance is well positioned to be an integral part of that process."

China is second to the United States in the number of people accessing the Internet, with over 110 million users online and projections for that number to exceed 300 million by 2008. Approximately 25% of China's online population uses Internet cafes for its Internet access, while in non-urban areas this number increases to 80%.