TEMPLETON CHINA WORLD FUND
                           FORM OF MULTIPLE CLASS PLAN


         This Multiple Class Plan (the "Plan") has been adopted unanimously by
the Board of Trustees of TEMPLETON CHINA WORLD FUND (the "Investment Company" or
the "Fund"). The Board has determined that the Plan, including the expense
allocation methods among the classes, is in the best interests of each class of
the Fund and the Investment Company as a whole. The Plan sets forth the
provisions relating to the establishment of multiple classes of shares of the
Fund, and supersedes any Plan previously adopted for the Fund.

         1. The Fund shall offer five classes of shares, to be known as
Class A Shares, Class B Shares, Class C Shares, Class R Shares and Advisor
Class/Class Z Shares.

         2. Class A Shares shall carry a front-end sales charge ranging
from [___% - ____ %], and Class C Shares shall carry a front-end sales charge of
1.00%. Class B Shares, Class R Shares and the Advisor Class/Class Z Shares shall
not be subject to any front-end sales charges.

         3. Class A Shares shall not be subject to a contingent deferred
sales charge ("CDSC"), except in the following limited circumstances. On
investments of $1 million or more, a contingent deferred sales charge of 1.00%
of the lesser of the then-current net asset value or the original net asset
value at the time of purchase applies to redemptions of those investments within
the contingency period of 18 months from the calendar month following their
purchase. The CDSC is waived in certain circumstances, as described in the
Fund's prospectus.

         Class B Shares shall be subject to a CDSC with the following CDSC
schedule: (a) Class B Shares redeemed within 2 years of their purchase shall be
assessed a CDSC of 4% on the lesser of the then-current net asset value or the
original net asset value at the time of purchase; (b) Class B Shares redeemed
within the third and fourth years of their purchase shall be assessed a CDSC of
3% on the lesser of the then-current net asset value or the original net asset
value at the time of purchase; (c) Class B Shares redeemed within 5 years of
their purchase shall be assessed a CDSC of 2% on the lesser of the then-current
net asset value or the original net asset value at the time of purchase; and (d)
Class B Shares redeemed within 6 years of their purchase shall be assessed a
CDSC of 1% on the lesser of the then-current net asset value or the original net
asset value at the time of purchase. The CDSC is waived in certain circumstances
described in the Fund's prospectus.

         Class C Shares and Class R Shares redeemed within 18 months of their
purchase shall be assessed a CDSC of 1.00% on the lesser of the then-current net
asset value or the original net asset value at the time of purchase. The CDSC is
waived in certain circumstances as described in the Fund's prospectus.

         Advisor Class/Class Z Shares shall not be subject to any CDSC.

         4. The distribution plan adopted by the Investment Company
pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended,
(the "Rule 12b-1 Plan") associated with the Class A Shares may be used to
compensate Franklin/Templeton Distributors, Inc. (the "Distributor") or others
for expenses incurred in the promotion and distribution of the Class A Shares.
Such expenses include, but are not limited to, the printing of prospectuses and
reports used for sales purposes, expenses of preparing and distributing sales
literature and related expenses, advertisements, and other distribution-related
expenses, including a prorated portion of the Distributor's overhead expenses
attributable to the distribution of the Class A Shares, as well as any
distribution or shareholder servicing fees paid to securities firms or others
who provide personal assistance to shareholders in servicing their accounts and
have executed a servicing agreement with the Investment Company for the Class A
Shares, the Distributor or its affiliates.

         The Rule 12b-1 Plan associated with the Class B Shares has two
components. The first component is an asset-based sales charge to be retained by
the Distributor to compensate Distributor for amounts advanced to securities
dealers or their firms or others with respect to the sale of Class B Shares. In
addition, such payments may be retained by the Distributor to be used in the
promotion and distribution of Class B Shares in a manner similar to that
described above for Class A Shares. The second component is a shareholder
servicing fee to be paid to securities firms or others who provide personal
assistance to shareholders in servicing their accounts and have executed a
servicing agreement with the Investment Company for the Class B Shares, the
Distributor or its affiliates.

         The Rule 12b-1 Plan associated with the Class C has two components. The
first component is a shareholder servicing fee, to be paid to securities firms
or others who provide personal assistance to shareholders in servicing their
accounts and have executed a servicing agreement with the Investment Company for
the Class C Shares, the Distributor or its affiliates. The second component is
an asset-based sales charge to be retained by the Distributor during the first
year after the sale of shares and, in subsequent years, to be paid to dealers or
retained by the Distributor to be used in the promotion and distribution of
Class C, in a manner similar to that described above for Class A Shares.

         The Rule 12b-1 Plan associated with the Class R Shares may be used to
compensate the Distributor or others for distribution activities and/or for
providing shareholder services. Distribution fees paid under the Rule 12b-1 Plan
may be retained by the Distributor to compensate the Distributor for amounts
advanced to securities dealers or their firms or others (including retirement
plan recordkeepers) with respect to the sale of Class R Shares. In addition,
such distribution fee payments may be retained by the Distributor to be used in
the promotion and distribution of Class R Shares in a manner similar to that
described above for Class A Shares, or may be paid out to dealers or others
(including retirement plan recordkeepers) that perform similar distribution
activities. Shareholder servicing fees may be paid to the Distributor or to
securities firms or others (including retirement plan recordkeepers) who have
executed a servicing agreement for Class R Shares with the Investment Company,
the Distributor or its affiliates as compensation for providing personal
assistance to shareholders or beneficial owners in servicing their accounts.

         No Rule 12b-1 Plan has been adopted on behalf of the Advisor
Class/Class Z Shares and, therefore, the Advisor Class/Class Z Shares shall not
be subject to deductions relating to Rule 12b-1 fees.

         The Rule 12b-1 Plans for the Class A, Class B, Class C and Class R
Shares shall operate in accordance with Rule 2830(d) of the Conduct Rules of the
National Association of Securities Dealers, Inc.

         5.  The only difference in expenses as between Class A, Class B,
Class C, Class R and Advisor Class/Class Z shall relate to differences in Rule
12b-1 plan expenses, as described in the applicable Rule 12b-1 Plans; however,
to the extent that the Rule 12b-1 Plan expenses of one Class are the same as the
Rule 12b-1 Plan expenses of another Class, such classes shall be subject to the
same expenses.

         6.  There shall be no CONVERSION FEATURES ASSOCIATED with the
Class A, Class C, Class R and Advisor Class/Class Z. Each Class B Share,
however, shall be converted automatically, and without any action or choice on
the part of the holder of the Class B Shares, into Class A Shares on the
conversion date specified, and in accordance with the terms and conditions
approved by the Templeton China World Fund's Board of Trustees and as described,
in the Fund's prospectus relating to the Class B Shares, as such prospectus may
be amended from time to time; provided, however, that the Class B Shares shall
be converted automatically into Class A Shares to the extent and on the terms
permitted by the Investment Company Act of 1940, as amended (the "1940 Act"),
and the rules and regulations adopted thereunder.

         7. Shares of Class A, Class B, Class C, Class R and Advisor
Class/Class Z may be exchanged for shares of another investment company within
Franklin Templeton Investments according to the terms and conditions stated in
each fund's prospectus, as it may be amended from time to time, to the extent
permitted by the 1940 Act and the rules and regulations adopted thereunder.

         8. Each class will vote separately with respect to any Rule
12b-1 Plan related to, or which now or in the future may affect, that class.

         9. On an ongoing basis, the Board members of the Investment
Company, pursuant to their fiduciary responsibilities under the 1940 Act and
otherwise, will monitor the Fund for the existence of any material conflicts
between the interests of the various classes of shares. The Board members of the
Investment Company, including a majority of the independent Board members, shall
take such action as is reasonably necessary to eliminate any such conflict that
may develop. Franklin Advisers, Inc. and Franklin Templeton Distributors, Inc.
shall be responsible for alerting the Board to any material conflicts that
arise.

         10.  All material amendments to this Plan must be approved by a
majority of the Board members of the Investment Company, including a majority of
the Board members who are not interested persons of the Investment Company.

         11.  I, Barbara J. Green, Secretary of the Templeton China World
Fund, do hereby certify that this Multiple Class Plan was adopted on behalf of
the Investment Company, by a majority of the Trustees of the Investment Company,
including a majority of the Board members who are not interested persons of the
Investment Company, on this 3rd day of December, 2002.


                                      --------------------------
                                      Barbara J. Green
                                      Secretary