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1、2023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm1/110F-1 1 yuezhonghuif1.htm As filed with the Securities and Exchange Commission on February 6,2023.UNITED STATESSECURITIES A
2、ND EXCHANGE COMMISSIONWashington,D.C.20549 FORM F-1REGISTRATION STATEMENTUNDERTHE SECURITIES ACT OF 1933 YUEZHONGHUI INTERNATIONAL HOLDINGS GROUPLTD(Exact name of Registrant as specified in its charter)United Kingdom 5960 Not Applicable(State or other jurisdiction of(Primary Standard Industrial(I.R.
3、S.Employerincorporation or organization)Classification Code Number)Identification Number)Room 531,Floor 5,Liangji BuildingEast Ring 1st Road,Fukang CommunityLonghua Street,Longhua District,ShenzhenYUEZHONGHUI INTERNATIONAL HOLDINGS GROUP LTDPeoples Republic of China 518109+44 07514685567(Address,inc
4、luding zip code,and telephone number,including area code,of Registrants principal executive offices)4305 SNYDER AVE BROOKLYNNewYorkAmerican Tuoyuan International Securities Group Inc.(Name,address of agent for service)F15,Fudan Science Park Building,No.11 Guotai RoadYangpu District,ShanghaiShanghai
5、Jinzhun Investment Management Co.,Ltd(Name,address of agent for service)Copies to:Approximate date of commencement of proposed sale to the public:As soon as practicable after the effective date of this RegistrationStatement.If any of the securities being registered on this Form are to be offered on
6、a delayed or continuous basis pursuant to Rule 415 under theSecurities Act of 1933,check the following box.If this Form is filed to register additional securities for an offering pursuant to Rule 462(b)under the Securities Act,please check thefollowing box and list the Securities Act registration st
7、atement number of the earlier effective registration statement for the same offering.If this Form is a post-effective amendment filed pursuant to Rule 462(c)under the Securities Act,check the following box and list theSecurities Act registration statement number of the earlier effective registration
8、 statement for the same offering.If this Form is a post-effective amendment filed pursuant to Rule 462(d)under the Securities Act,check the following box and list theSecurities Act registration statement number of the earlier effective registration statement for the same offering.Indicate by check m
9、ark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.Emerging growth company x If an emerging growth company that prepares its financial statements in accordance with U.S.GAAP,indicate by check mark if theregistrant has elected not to use the
10、extended transition period for complying with any new or revised financial accounting standardsprovided pursuant to Section 7(a)(2)(B)of the Securities Act.x2023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/00019
11、6460323000002/yuezhonghuif1.htm2/110 The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until theRegistrant shall file a further amendment which specifically states that this registration statement shall thereafter become ef
12、fective inaccordance with Section 8(a)of the Securities Act,as amended,or until the registration statement shall become effective on such date as theSecurities and Exchange Commission,acting pursuant to said Section 8(a)may determine.2023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/00019646032
13、3000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm3/110As filed with the Securities and Exchange Commission on February 6,2023.PRELIMINARY PROSPECTUSORDINARY SHARES We are offering ordinary shares.This is the initial public offering of ordina
14、ry shares of .The offering price ofour ordinary shares in this offering is expected to be$6.50 per share.Prior to this offering,there has been no public market for our ordinaryshares.We have applied to list our ordinary shares on the Nasdaq Capital Market under the symbol“YZH”.There is no assurance
15、that suchapplication will be approved,and if our application is not approved,this offering may not be completed.Investing in our ordinary shares involves a high degree of risk.Before buying any shares,you should carefully read the discussionof material risks of investing in our ordinary shares in“Ri
16、sk Factors”.We are an“emerging growth company”as defined under the federal securities laws and,as such,will be subject to reduced public companyreporting requirements.See“Prospectus SummaryImplications of Being an Emerging Growth Company”for additional information.Neither the Securities and Exchange
17、 Commission nor any other regulatory body has approved or disapproved of these securities orpassed upon the accuracy or adequacy of this prospectus.Any representation to the contrary is a criminal offense.We are not a Chinese operating company,but rather a holding company incorporated in the United
18、Kingdom.As a holding company withno material operations of our own,we conduct a substantial majority of our operations through our operating entities established in thePeoples Republic of China(or the“PRC”).The Ordinary Shares offered in this prospectus are shares of the United Kingdom holdingcompan
19、y.Holders of our Class A Ordinary Shares do not directly own any equity interests in our Chinese operating subsidiaries,but willinstead own shares of a United Kingdom holding company.The Chinese regulatory authorities could disallow our corporate structure,which would likely result in a material cha
20、nge in our operations and/or a material change in the value of our Ordinary Shares,including thatit could cause the value of our Ordinary Shares to significantly decline or become worthless.Unless otherwise stated,as used in thisprospectus and in the context of describing our operations and consolid
21、ated financial information,“we,”“us,”“Company,”or“our,”refersto YUEZHONGHUI INTERNATIONAL HOLDINGS GROUP LTD,a United Kingdom holding company.For a description of ourcorporate structure,see“Corporate History and Structure.”See also“Risk Factors Risks Relating to Our Corporate Structure.”2023/2/9http
22、s:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm4/110As filed with the Securities and Exchange Commission on February 6,2023.We face various legal and operational risks and uncertainties
23、 relating to our operations in China.These risks,together with uncertainties inChinas legal system and the interpretation and enforcement of Chinese laws,regulations,and policies,could hinder our ability to offer orcontinue to offer our securities,result in a material adverse effect on our business
24、operations,and damage our reputation,which could causeour shares to significantly decline in value or become worthless.The Chinese government may intervene or influence the operations of ourPRC subsidiaries at any time and may exert more control over offerings conducted overseas and/or foreign inves
25、tment in China-basedissuers,which could result in a material change in the operations of our PRC subsidiaries and/or the value of our common stock.Anyactions by the Chinese government to exert more oversight and control over offerings that are conducted overseas and/or foreign investmentin China-bas
26、ed issuers could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and causethe value of such securities to significantly decline or be worthless.Recently,the PRC government adopted a series of laws,regulatorymeasures and issued statements to
27、regulate business operations in China,including cracking down on illegal activities in the securitiesmarket,adopting new measures to extend the scope of cybersecurity reviews,and expanding the efforts in anti-monopoly enforcement.TheCyberspace Administration of China(“CAC”)has opened cybersecurity p
28、robes into several U.S.-listed technology companies focusing onanti-monopoly regulation,and how companies collect,store,process and transfer data,among other things.If we are subject to such a probeor are required to comply with the stringent requirements of the new regulations,our ability to conduc
29、t our business or list on a U.S.stockexchange may be restricted.As of the date of this prospectus,we and our subsidiaries have not been involved in any investigations oncybersecurity review initiated by any Chinese regulatory authority,nor has any of them received any inquiry,notice or sanction.Ther
30、e arecurrently no relevant laws or regulations in China that prohibit companies whose subsidiaries or entity interests are within China fromlisting on overseas stock exchanges.However,since these statements and regulatory actions are newly published,official guidance andrelated implementation rules
31、have not been issued.It is highly uncertain what the potential impact such modified or new policies andregulations will have on our daily business operation,the ability to accept foreign investments and our ability to continue trading on a U.S.securities marketplace or stock exchange.PER SHARE TOTAL
32、 Initial public offering price$Underwriting discounts and commissions(1)$Proceeds,before expenses,to us$(1)Does not include accountable and non-accountable expense allowance payable to underwriters.Please see the section of thisprospectus entitled“Underwriting”for additional information regarding un
33、derwriter compensation.We expect our total cash expenses for this offering(including cash expenses payable to our underwriters for their out-of-pocket expenses)to be approximately$,exclusive of the above commissions.In addition,we will pay additional items of value in connection with thisoffering th
34、at are viewed by the Financial Industry Regulatory Authority,or FINRA,as underwriting compensation.These payments willfurther reduce proceeds available to us before expenses.See“Underwriting.”Neither we nor any of the underwriters have authorized anyone to provide any information or to make any repr
35、esentations other than thosecontained in this prospectus or in any free writing prospectuses we have prepared.Neither we nor any of the underwriters takeresponsibility for,and can provide no assurance as to the reliability of,any other information that others may give you.This prospectus isan offer
36、to sell only the shares offered hereby,but only under circumstances and in jurisdictions where it is lawful to do so.The informationcontained in this prospectus is current only as of its date,regardless of the time of delivery of this prospectus or of any sale of our commonstock.For investors outsid
37、e the United States:Neither we nor any of the underwriters have done anything that would permit this offering orpossession or distribution of this prospectus in any jurisdiction where action for that purpose is required,other than in the United States.Persons outside the United States who come into
38、possession of this prospectus must inform themselves about,and observe any restrictionsrelating to,the offering of the shares of our common stock and the distribution of this prospectus outside the United States.Neither the Securities and Exchange Commission nor any state securities commission nor a
39、ny other regulatory body has approved ordisapproved of these securities or determined if this prospectus is truthful or complete.Any representation to the contrary is a criminaloffense.2023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archi
40、ves/edgar/data/1964603/0000002/yuezhonghuif1.htm5/110As filed with the Securities and Exchange Commission on February 6,2023.TABLE OF CONTENTS PagePROSPECTUS SUMMARY1OFFERINGS10RISK FACTORS11SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS41USE OF PROCEEDS43DIVIDEND POLICY44CAPITALIZATIO
41、N45DILUTION47CORPORATE HISTORY AND STRUCTURE48MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS49BUSINESS52REGULATIONS71MANAGEMENT84PRINCIPAL SHAREHOLDERS89RELATED PARTY TRANSACTIONS DESCRIPTION OF SHARE CAPITAL90SHARES ELIGIBLE FOR FUTURE SALE95TAXATION97UNDERWRIT
42、ING100LEGAL MATTERS103EXPERTS103WHERE YOU CAN FIND ADDITIONAL INFORMATION103 2023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm6/110As filed with the Securities and Exchange Co
43、mmission on February 6,2023.PROSPECTUS SUMMARY The following summary is qualified in its entirety by,and should be read in conjunction with,the more detailed information and financialstatements In addition to this summary,we urge you to read the entire prospectus carefully,especially the risks of In
44、vesting in our OrdinaryShares discussed under Risk Factors before deciding whether to buy our Ordinary Shares.Our Mission Our mission is to use digital technology platform to build a new intelligent industry,dedicated to connecting enterprise business,linkingglobal industry,integrating resources and
45、 achieving win-win situation.Overview of Our Company The company is committed to investment promotion,investment and financing consulting,brand planning,brand marketing,helpingenterprises to open online and offline sales promotion channels,and expanding cross-border sales channels for domestic and o
46、verseas;thecompany gathers a rich product supply chain,and carefully builds a digital new retail ecological platform of YueZhongHui,using high-quality products and industrial projects as the medium to achieve cross-border integration,cross-enterprise,cross-industry,cross-community,cross-industry Coo
47、peration,for consumers and businesses,for online and offline to build a bridge of mutual communication,helping the public Consumer Entrepreneurship,Consumer Pension Plan,to make more people healthy and happy!The new Consumer NewRetail Plan,entertainment e-commerce model,new media marketing tools to
48、make the platform,business and consumer win-win,so thatmore people through the digital new retail ecosystem to create wealth!History and Development YueZhongHui is a new company,but carries deep operational management experience.At the level of management team,Chairman Chengsheng Feng has more than
49、30 years of elite,management and marketing experience andhas held positions such as general manager in many new retail fields,accumulating rich market channels and supply chain channels.ViceChairman Xiaodong Song has held the positions of chairman and general manager of many industries such as e-com
50、merce,business traveland exhibition,retail,etc.He has rich market experience and management experience,and has hosted many large-scale physical projects,accumulating rich operation experience and human resources channels.At the core team level,we have introduced Yahuan Song,the legal director who ha
51、s long experience in corporate law and companymanagement and operation,Pengcheng Feng who has rich experience in legal professional work,rich experience in e-commerce andmarketing,and Yushan Chen who has thirty years of experience in international trade and business management.In the post-epidemic e
52、ra,the impact of the new crown epidemic is ongoing,and the degree of online economic and social activities willcontinue to grow at a high rate going forward.The way of living online and working online extends the scope of the population extremelywide,and consumers are turning to online consumption o
53、n a large scale,which greatly stimulates the development of global e-commerceretail industry.In this context,we have formed a management and core team with rich experience in e-commerce,using SAAS marketingbusiness planning digital platform and other new media marketing tools to make the platform,pu
54、t forward innovative operational conceptsand models,focusing on global interoperability development,with quality products and services as the medium,to build a new digital e-commerce circle!Industry Enterprise Consulting And Management industry and E-commerce Service industry.With its focus on model
55、 innovation and new productdesign,YueZhongHui is actively exploring and practicing,aiming to build an ecosystem that organically integrates e-commerce and cross-border activities based on accurate big data,and provide high-quality digital business services to enterprises and individuals.12023/2/9htt
56、ps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm7/110As filed with the Securities and Exchange Commission on February 6,2023.Our Solutions YueZhongHui will refine to build a digital new
57、 retail ecological platform,use big data as the basis for analysis,use the driving force of newtechnology development,gate-keep every process of products from production to sales,take quality products and services as the core,builda business activity service platform of information communication,res
58、ource sharing,policy coordination,industrialization,capitalizationand digital operation according to the needs and demands of enterprises themselves.Enhance the market competitiveness and self-innovation of enterprises,strengthen the communication and cooperation between enterprises,use technology t
59、o empower and drive digitaldevelopment,and achieve high-quality development of enterprises.Our Services Our core business mainly includes the following eleven services:(a)business consulting and planning services;(b)Digital intelligentmarketing services;(c)commodity sharing services;(d)supply chain
60、collaboration services;(e)personalized brand operation services;(f)new media operation services;(g)business project incubation services;(h)business management training and education services,etc.;(i)business team building services;(x)corporate finance and taxation legal services;(xi)digital strategi
61、c layout planning services.Our Competitive Advantages I.Aggregate multiple strategic resources to create a digital business service platform for enterprisesThe company was established by a number of experienced corporate directors and business elites,and innovates and upgrades theconnectivity model
62、among enterprises,using digital platform to drive the development of product industry,joining hands with variouschambers of commerce,associations,government and other platforms,and is committed to serving millions of enterprises.II.The founding team has been working in the industry for many years an
63、d is experienced in related fieldsThe founding team has many years of operational experience and rich resources in related fields.III.According to the needs of enterprises to provide personalized servicesBy studying the development trend of different enterprises in the industry,we will create a set
64、of products and services and marketingmodel that best suits the enterprise,and at the same time,we will customize personalized services according to the enterprises demands.IV.Optimization of the epidemic policy brings significant benefitsBefore the optimization of the epidemic policy,the domestic e
65、-commerce market was relatively saturated and affected by the epidemic,thedevelopment trend was not optimistic,and the development of cross-border e-commerce was hindered.After the optimization of theepidemic policy,the demand of e-commerce platforms seeking incremental overseas market rose,and the
66、product service was developingfrom price advantage towards product and service advantage,in this context,as an emerging technology-based e-commerce servicecompany,we have a huge advantage.Our Challenge I.Willingness to consume downwardThe rising price level makes most households spend less on non-es
67、sential goods,while the pharmaceutical scare during the epidemicliberalization phase has had a huge impact on the majority of consumers,making them spend several times more on related pharmaceuticalproducts,directly reducing the amount they can spend on other products and reducing the demand side,le
68、aving both the supply side and thesellers in a difficult situation.22023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm8/110As filed with the Securities and Exchange Commission
69、on February 6,2023.II.New demand is greater than replacement demandIn the traditional retail era,online consumption focused on convenient consumption channels and good shopping experience to meetconsumers replacement needs,while in the new retail era,we need more to create and meet new consumption n
70、eeds,such as the expansionof online consumer goods variety,quality improvement,brand innovation,and new demands inspired by the diversification of consumptionchoices,and the new demands are now greater than the replacement demands.III.The impact of the market levelIn the current domestic e-commerce
71、industry market,our main competitors include Alibaba,JD,Pinduoduo,the Internet e-commerceindustry giants that have the will to expand incrementally in overseas markets,and in the future development stage,we will gradually facethe impact of these rivals in the international market arena.Our Market Op
72、portunities The easing of the epidemic,the gradual opening of international markets,the demand for intelligent new retail platforms from enterprises,and the constantly renewed consumer demand are all market opportunities for us.What we do Create a service platform for information communication,resou
73、rce sharing,policy coordination,industrialization,capitalization,digitaloperation and other business activities,build to produce to enhance the market competitiveness of enterprises and self-innovation,strengthen the exchange and cooperation between enterprises,the use of technology to empower,digit
74、al development drive,to achievehigh-quality development of enterprises digital overall solutions.The company has made bold exploration and innovation on the traditional consumption and sales model,forming three innovative businessmodels:Consumer Entrepreneurship,Consumer Pension Plan and Consumer Ne
75、w Retail Plan.Consumer Pension Plan Model:The company creates a new type of points ecosystem,consumers can obtain consumption green pointsthrough daily consumption,and the green points are converted into consumption capital profit as the revenue entrance,which istransformed into an innovative consum
76、ption pension protection model through government guidance,market-oriented operation and theintroduction of social commercial insurance mechanisms,and then forms a consumption pension ecological cycle mechanism.This is akind of consumer pension ecosystem which is fully connected with the market and
77、full of self-generating cycle vitality.By creating a closedloop of consumer ecology,through the Internet of Things,big data,cloud computing and commercialization services of enterprises,it opensthe way to exchange the green points accumulated by online consumption and offline services for social com
78、mercial insurance,completesthe value-added consumer services and creates another new model for solving the whole societys pension.Consumer Entrepreneurship Model:YueZhongHui company seizes the consumers daily consumption of accumulated discounts and thecreation of consumer capital profits this entra
79、nce into the points quantification system,detonate the power of new consumer users,accelerate the promotion of new consumption expansion and quality,continue to stimulate consumer vitality,promote the deep integrationof online and offline consumption,in the golden age of consumer entrepreneurship,ha
80、ve more consumer community,create countlessbusiness opportunities and empowerment business circle Ecosystem profit points,for sales channels,product importance reputation loyalty,traffic data,marketing model,science and technology research and development,brand promotion and other resources redistri
81、bution,creating a hot eye of the storm consumer track,so that more users become the final winner,to achieve the dual benefits of consumption andentrepreneurship.32023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/
82、0000002/yuezhonghuif1.htm9/110As filed with the Securities and Exchange Commission on February 6,2023.Consumer New Retail Plan Model:The development strategy of YueZhongHui is to take the combination of strong product supply chainoffline chain structure and online shopping mall platform a
83、s the core,promote the integration of high-quality products and big consumption,online and offline,upstream and downstream of the industry chain,and build big data supermarket as the digital operation benchmark ofnew consumer retail.We will build a digital supply chain platform for enterprise mercha
84、nts and the upstream and downstream of the bigconsumption industry chain,strategically develop our own brand business and IP creation,form a digital service platform for the wholechain of the industry,create a consumer-centric,digital retail scenario for consumption,and an ecological integration mod
85、el for the wholeterminal service,and continue to expand the operational capability and realization value of user consumption,data assets,entertainmentmarketing tools,omni-domain marketing and trust marketing,resource management technology,store technology display technology,etc.to form an empowering
86、 consumer economy digital ecosystem.Through online and offline consumption data analysis and other technicaltools,YueZhongHui helps sales terminal chains carry out digital transformation of scenes around offline scenes,online incremental servicerefinement,accurate conversion of store stock,unified i
87、ntelligent quick payment and other areas,and simultaneously establish 3Dintelligent shopping guide system,online mall of local specialties and local service value-added city integration platform,and open livemarketing empowerment.It also establishes a 3D intelligent shopping guide system,a hometown
88、integration platform for local specialtyproducts and local service value-added in the online mall,opens a live marketing port to empower local dealers,and diverts local consumeronline traffic to local offline stores to solve bottlenecks such as digitalization of goods,data analysis of consumer deman
89、d,conversion ofcustomer flow,derivative consumption and repeated consumption in the terminal physical stores.Our company structure 42023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghui
90、f1.htm10/110As filed with the Securities and Exchange Commission on February 6,2023.Our Strategy After a thorough analysis of the current industry and market trends,the specific market needs of our core customer groups,and our ownstrategic resources and advantages,we have developed a business strate
91、gy with a holistic and systematic view that is appropriate for ourcurrent development stage,taking into account the many problems and challenges we have faced in the previous development and operationstages.At this stage,our strategy is divided into five main periods,as follows.I.Enterprise planning
92、 and preparation period(2022)We will implement and complete the initial planning and establishment strategy for the business in 2022.The specific work plan andcontents are:First,from the beginning of 2022 to April 2022,we will complete the initial planning of the enterprise,including identifyingthe
93、founding members and core team,raising and selecting the necessary initial capital and office space for the establishment of theenterprise,and initially determining the core organizational structure and personnel management model;Second,from May 2022 to June2022 Complete market research and prelimin
94、ary business planning,including industry research and customer group demand analysis,preliminary construction of business model and marketing model,analysis of each risk faced after the work and provide contingency plans,etc.;Third,from July 2022 to September 2022,complete the strategic layout of in
95、dustrial ecology and system platform construction,including Pre-integration of supply chain and sales channel resources,hiring a team of programmers to build and develop the digital systemplatform,and pre-testing each function of the online platform,etc.;Fourth,formally establish the YueZhongHui bus
96、iness platform and carryout initial operation from October 2022 to November 2022,including determining the official name of the platform and carrying out initialpublicity,carrying out online trial operation of the platform and recording customer feedback,etc.and record the feedback from customers,et
97、c.II.The expansion of investment financing M&A period(2023)We plan to carry out the expansion work of investment,financing and M&A of our platform in 2023.The specific work plan and contentare:first,investment in the work,that is,on the basis of the previously pre-integrated supply chain channel res
98、ources,officially carry outthe investment in the market subject to the ecological platform of YueZhongHui,in order to establish and form a complete range of supplychain system that can meet diversified consumer demand;second,the development of independent brand products,that is,from theplatforms man
99、y supply chain resources to select high standards,high quality,high market demand for quality products supply sources,andcombine these quality products supply sources with the platforms own brand.Second,to develop our own brand products,that is,to selecthigh standard,high quality,high market demand
100、of quality product supply sources from the platforms many supply chain resources,and tocombine these quality product supply sources with the platforms own brand to create our own brand products;Third,to promote the agentbrand products in domestic and international markets,that is,to promote and sell
101、 our agent brand products in the domestic market throughonline and offline channels,and to establish a chain of institutions in China to improve the visibility and sales of products.At the sametime,we will also take the lead in the international sales of our brand products,including the promotion an
102、d sales in overseas markets,andplay an important role in cross-border e-commerce;fourth,we will accomplish our strategic objectives in the financial field,includingstarting the process of listing on NASDAQ,implementing M&A,investment and financing,and other industry-financing strategies,providing th
103、e company with more sources of capital and broader investment opportunities,and helping more We will also help morecompanies achieve business expansion and development.III.Complete the construction of patent deployment system(2024)We plan to build a complete patent control system in 2024,and the spe
104、cific work plan and content are:first,to improve the internationalpatent intellectual property protection system of our own brand,including the application for the confirmation of intellectual property rightssuch as trademarks and patents under our own brand,and the establishment of a litigation sys
105、tem for the infringement of rights to ensurethat the sales of our own brand in the international market are not affected by infringement;second,to expand Second,expand the domesticand foreign market sales channels of our own brands,and continue to develop the platform online and offline chain instit
106、utions,specificallyincluding the domestic and foreign markets,through the e-commerce platform and physical stores to sell our own brands,and continue toincrease more stores and sales channels,so that our customer base continues to expand;third,build the core industrial chain system,helpmore enterpri
107、ses to build brand products,that is,through financing,mergers and acquisitions and other Financial measures such asfinancing,mergers and acquisitions to acquire upstream and downstream enterprises in the industry chain,in order to form a set of coreindustry chain system that covers the complete and
108、can achieve long-term profit growth,and help other enterprises to build their own brandproducts,in order to improve the comprehensive competitiveness of the platform and create greater value.52023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.go
109、v/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm11/110As filed with the Securities and Exchange Commission on February 6,2023.IV.The completion of the brand layout system,start to enter the international market(2025)We will complete the construction of our own brand layout system i
110、n 2025,and gradually and orderly start to develop and expand theinternational market.The specific work plan and content are:first,to carry out the strategic layout of our own brand in the internationalmarket,we will fully carry out international market research,promotion of our own brand products,et
111、c.,and at the same time,we will lookfor suitable agents and channel partners in the international market,and strengthen investment in product development and continuouslyimprove product quality to meet the needs of the international market;second,to carry out financing in the international market Me
112、rgersand acquisitions,in order to enhance the competitiveness of our own brand system in the international market,we will help moreenterprises enter the international market through financing,mergers and acquisitions and other measures,in order to continuously expandthe business scope of our platfor
113、m,brand awareness,and maximize economic and social benefits.Third,we will form the largest digitalnew retail business platform in China.Based on our experience in brand expansion in international markets,we will continuously upgradeand improve our domestic business platform,and continue to expand it
114、s scale to form the most influential digital new retail businessplatform in China with market coverage.V.Aggregate and build a common business alliance to create a win-win development path(2026)We will enable more companies to become partners under our platform in 2026,following a symbiotic,shared a
115、nd win-win developmentpath guided by the concept of long-termism and sustainability.We plan to achieve the following in 2026.First,we will build an allianceplatform in China,we will gather more partners mainly from enterprises,and use the platform as a centralized support to build a mutuallybenefici
116、al and win-win business cooperation system to achieve our long-term,stable and lasting win-win development goals;second,wewill take the international alliance expansion road,we will open operations in the United States,Canada,the United Kingdom,Madagascar,Malaysia,South Korea and other countries and
117、 regions We will open branches in the United States,Canada,the United Kingdom,Madagascar,Malaysia,Korea and other countries and regions,and adopt a point-to-point strategic plan to gradually strengthen our strategicdeployment in the international market and lay the foundation stone for our long-term
118、 development in the international market.Risk Factors Summary I.The macro side of consumption showed weaknessThe real growth rate of residents income in the post-epidemic era has seen a sharp decline,and the restricted consumption scenario relatedto the anti-epidemic policy and the shrinking social
119、radius have also objectively inhibited consumption,while consumer confidence hasfallen off a cliff,especially on employment,and macro-level consumption is not optimistic.II.Cross-border e-commerce industry maturity is not high2021s Amazon seal gate to the international e-commerce industry out of the
120、 country to sound the alarm,we do not yet have a mature andhealthy compliance of cross-border e-commerce identity.III.The risk of data leakage is highIn recent years,many well-known e-commerce industry has data leakage phenomenon,for an e-commerce platform with a large number ofcustomer groups,the r
121、isk of data leakage can not be ignored.Implications of Being an Emerging Growth Company I.Large potential growth spaceCompared to large cap companies,emerging growth companies are at an earlier stage of the business cycle and have the potential to growmore rapidly than the overall stock market.Compa
122、red to mature market business models,emerging growth companies tend to experimentwith innovative,technology-based,and contemporary business models,and seek to maximize their growth by studying the development ofthe times and market demand and adjusting their own positioning.62023/2/9https:/www.sec.g
123、ov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm12/110As filed with the Securities and Exchange Commission on February 6,2023.II.Many sources of development opportunitiesAs an emerging growth compan
124、y,the initial disclosure of listed company data and information is relatively small,the development strategyof the companys operation has diversity,the investment cost is not high,it is easy to attract some more aggressive investors to invest,forthe emerging market,also has the conditions to diversi
125、fy the choice,and then to specialize,with more possibilities.III.Market competition can be regulatedPeer competition is one of the challenges faced by companies in the course of their operations.In the early stages of their development,emerging growth companies will encounter large market capitaliza
126、tion companies that are already established in the same industry.In thecase of the same business,emerging growth companies can adjust the competitive disadvantages they face by timely adjusting theirbusiness tendencies,playing to their strengths and discarding their weaknesses.IV.ConclusionIn the fi
127、nal analysis,the factors affecting the development of emerging enterprises are multifaceted and cannot be discussed in a single way.However,if a company wants to develop in the long term,it must conduct in-depth research on the market environment,keep up with thedevelopment of the times,customize a
128、business model suitable for its own development,have a sense of renewal of its own products,andclarify a development path suitable for itself before forming a certain scale,in order to develop from an emerging growth company into alarge scale company with large market capitalization.Implications of
129、Our Being an Emerging Growth Company On September 9,2022,the SEC adopted inflation adjustments mandated by the Jumpstart Our Business Startups Act of 2012(the JOBSAct).).As a result,an emerging growth company will lose its emerging growth company status on the last day of the fiscal year in As aresu
130、lt,an emerging growth company will lose its emerging growth company status on the last day of the fiscal year in which it has$1.235billion or more in total.As a company with less than$1.235 billion in revenue during our last fiscal year,we qualify as an emerginggrowth company as defined in the JOBS
131、Act.An emerging growth company may take advantage of reduced reporting requirementsthat are otherwise applicable to larger public companies.In particular,as an emerging growth company,we:may present only two years of audited financial statements and only two years of related Managements Discussion a
132、nd Analysis ofFinancial;may present only two years of audited financial statements and only two years of related Managements Discussion and Analysis ofFinancial Condition and Results of Operations;are not required to provide a detailed narrative disclosure discussing our compensation principles,obje
133、ctives and elements and analyzinghow those are not required to provide a detailed narrative disclosure discussing our compensation principles,objectives and elements andanalyzing how those are not required to provide a detailed narrative disclosure discussing our compensation principles,objectives a
134、ndelements and analyzing how those elements fit with our principles and objectives,which is commonly referred to as compensationdiscussion and analysis;are not required to obtain an attestation and report from our auditors on our managements assessment of our internal control overfinancial reporting
135、 pursuant to the Sarbanes-Oxley Act of 2002;are not required to obtain a non-binding advisory vote from our shareholders on executive compensation or golden parachutearrangements(commonly referred to as the say-on-pay,say-on-frequency and say-on-golden-parachute votes);are exempt from certain execut
136、ive compensation disclosure provisions requiring a pay-for-performance graph and CEO pay ratiodisclosure;are exempt from the requirement to disclose the CEO pay ratio;and are exempt from certain executive compensation disclosureprovisions requiring a pay-for-performance graph and CEO pay ratio discl
137、osure;72023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm13/110As filed with the Securities and Exchange Commission on February 6,2023.are eligible to claim longer phase-in per
138、iods for the adoption of new or revised financial accounting standards under 107 of the JOBSAct;and are eligible to claim longer phase-in periods for the adoption of new or revised financial accounting standards under 107 of the JOBSAct;and will not be required to conduct an evaluation of our intern
139、al control over financial reporting until our second annual report on Form 20-Ffollowing the will not be required to conduct an evaluation of our internal control over financial reporting until our second annual report onForm 20-F following the effectiveness of our initial public offering.We intend
140、to take advantage of all of these reduced reporting requirements and exemptions,including the longer phase-in periods for theadoption of new or revised financial accounting standards under 107 of the JOBS Act.Our election to use the phase-in periods may makeit difficult to compare our financial stat
141、ements to those of non-emerging growth companies and other emerging growth companies that haveopted out of the JOBS Act.Our election to use the phase-in periods may make it difficult to compare our financial statements to those ofnon-emerging growth companies and other emerging growth companies that
142、 have opted out of the phase-in periods under 107 of theJOBS Act.Our election to use the phase-in periods may make it difficult to compare our financial statements to those of non-emerginggrowth companies and other emerging growth companies that have opted out of the phase-in periods under 107 of th
143、e JOBS Act.Under the JOBS Act,we may take advantage of the above-described reduced reporting requirements and exemptions until we no longermeet the definition of an emerging growth company.The JOBS Act provides that we would cease to be an emerging growth company atthe end of the fiscal year in whic
144、h the fifth anniversary of our initial sale of common equity pursuant to a registration statement declaredthat we are an emerging growth company.The JOBS Act provides that we would cease to be an emerging growth company at the end ofthe fiscal year in which the fifth anniversary of our initial sale
145、of common equity pursuant to a registration statement declared effectiveunder the Securities Act of 1933,as amended(as amended).of 1933,as amended(the Securities Act)occurred,if we have more than$1.235 billion in annual revenue,have more than$700 million in market value of our Class A Ordinary Share
146、 held by non-affiliates,orissue more than$1 billion in principal amount of non-convertible debt over a three-year period.Foreign Private Issuer Status We are a foreign private issuer within the meaning of the rules under the Securities Exchange Act of 1934,as amended(the ExchangeAct).As such,we are
147、exempt from certain provisions applicable to United States domestic public companies.)As such,we are exemptfrom certain provisions applicable to United States domestic public companies.For example:We are not required to provide as many Exchange Act reports,or as frequently,as a domestic public compa
148、ny;we are not required toprovide as many Exchange Act reports as possible.We are not required to provide as many Exchange Act reports,or as frequently,as adomestic public company;For interim reporting,we are permitted to comply solely with our home country requirements,which are less rigorous than t
149、he rules thatapply to domestic reporting.For interim reporting,we are permitted to comply solely with our home country requirements,which are less rigorous than the rules thatapply to domestic public companies;We are not required to provide the same level of disclosure on certain issues,such as exec
150、utive compensation;we are not required toprovide the same level of disclosure on certain issues,such as executive compensation.We are not required to provide the same level of disclosure on certain issues,such as executive compensation;We are exempt from provisions of Regulation FD aimed at preventi
151、ng issuers from making selective disclosures of material information;We are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies,consents,or authorizations inrespect of a security registered under the Exchange Act;and 82023/2/9https:/www.sec.gov/Archive
152、s/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm14/110As filed with the Securities and Exchange Commission on February 6,2023.We are not required to comply with Section 16 of the Exchange Act requiring inside
153、rs to file public reports of their share ownership andtrading activities.we are not required to comply with Section 16 of the Exchange Act requiring insiders to file public reports of their share ownership andtrading activities and establishing insider liability for profits realized from any“short-s
154、wing”trading transaction.Implications of Being a Controlled Company Controlled companies are exempt from the majority of independent director requirements.Controlled companies are subject to anexemption from Nasdaq Controlled companies are subject to an exemption from Nasdaq standards requiring that
155、 the board of a listedcompany consist of a majority of independent directors within one year of the listing date.Public Companies that qualify as a Controlled Company with securities listed on the Nasdaq Stock Market(Nasdaq),must Nasdaq hasadopted qualitative listing standards.Companies that do not
156、comply with these corporate governance requirements may lose their listingstatus.Under the Nasdaq rules,a controlled company is a company with more than 50%of its voting power held by a single person,entity or group.Under the Nasdaq rules,a controlled company is exempt from certain corporate governa
157、nce requirements including:the requirement that a majority of the board of directors consist of independent directors the requirement that a majority of the board ofdirectors consist of independent directors;the requirement that a listed company have a nominating and governance committee that is com
158、posed entirely of independent directorswith a written charter addressing the committees purpose and responsibilities;the requirement that a listed company have a compensation committee that is composed entirely of independent directors with a writtencharter addressing the committees purpose and resp
159、onsibilities;and the requirement for an annual performance evaluation of the nominating and governance committee and compensation committee.Controlled companies must still comply with the exchanges other corporate governance standards.These include having an auditcommittee and the special meetings o
160、f independent or non-management directors.These include having an audit committee and the specialmeetings of independent or non-management directors.Our Pre-IPO Prior to the IPO,we total share capital was about 200,000,000 ordinary shares.This time,about 50,000,000 ordinary shares were added,which i
161、s we expect that the initial public offering price will be no less than US$6.50 per share.92023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm15/110As filed with the Securities
162、and Exchange Commission on February 6,2023.OFFERINGS Below is a summary of the terms of the offering:Issuer YUEZHONGHUI INTERNATIONAL HOLDINGS GROUP LTD Securities Being Offered Ordinary Shares,par value US$0.0001 per share Offering Price We expect that the initial public offering price will be US$6
163、.50 per Ordinary Share.Ordinary Shares OutstandingImmediately Before This Offering Ordinary Shares Ordinary Shares OutstandingImmediately After This Offering Ordinary Shares(or Ordinary Shares if theunderwriters exercise their option to purchase additional Ordinary Shares in full).Voting Rights Each
164、 Ordinary Share is entitled to one vote.Use of Proceeds Proposed Nasdaq Trading Symbol andListing We plan to apply to list our Ordinary Shares on the Nasdaq Capital Market underthe symbol“YZH”This offering is contingent upon us listing our Ordinary Shares onNasdaq Capital Market or another national
165、exchange.No assurance can be giventhat such listing will be approved or that a liquid trading market will develop for ourOrdinary Shares.Lock-up Our directors,executive officers,and shareholder who own 5%or more of theoutstanding Ordinary Shares intended agreed with the underwriters not to offer for
166、sale,issue,sell,contract to sell,pledge or otherwise dispose of any of our OrdinaryShares or securities convertible into Ordinary Shares for a period of 6months commencing on the date of this prospectus.The Company is also prohibitedfrom conducting offerings during this period and from re-pricing or
167、 changing theterms of existing options and warrants.See“Underwriting”for additionalinformation.Transfer Agent Risk factors See“Risk Factors”for a discussion of risks you should carefully consider beforeinvesting in our Ordinary Shares.102023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/00019646
168、0323000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm16/110As filed with the Securities and Exchange Commission on February 6,2023.RISK FACTORS An investment in our Ordinary Shares involves a high degree of risk.Before deciding whether to inv
169、est in our Ordinary Shares,you shouldconsider carefully the risks described below,together with all of the other information set forth in this prospectus,including the sectiontitled“Managements Discussion and Analysis of Financial Condition and Results of Operations”and our consolidated financial st
170、atementsand related notes.If any of these risks actually occurs,our business,financial condition,results of operations or cash flow could bematerially and adversely affected,which could cause the trading price of our Ordinary Shares to decline,resulting in a loss of all or part ofyour investment.The
171、 risks described below and in the documents referenced above are not the only ones that we face.Additional risks notpresently known to us or that we currently deem immaterial may also affect our business.You should only consider investing in ourOrdinary Shares if you can bear the risk of loss of you
172、r entire investment.Risks Related to Our Business We have grown rapidly in recent years and have limited experience operating at our current scale of operations.If we are unable tomanage our growth effectively,our brand,company culture and financial results may suffer.We have grown rapidly in the pa
173、st year and our recent growth rates and financial results should not be considered indicators of our futureperformance.In order to effectively manage and leverage our growth,we must continue to expand our sales and marketing,focus oninnovative product and website development,and upgrade our manageme
174、nt information systems.Our continued growth has in the past andmay in the future strain our existing resources and we may experience ongoing operational difficulties in managing our operations innumerous jurisdictions,including difficulties in recruiting,training and managing a dispersed and growing
175、 employee base.Failure toexpand and maintain our company culture through growth may harm our future success,including our ability to retain and recruit personneland to effectively focus on and pursue our corporate goals.Retail-Nonstore Retailers industry is evolving rapidly and may not evolve as we
176、expect.Even if our net sales continue to grow,our net salesgrowth rate may decline in the future due to a variety of factors,including macroeconomic factors,changes in supply and supply chain,changes in consumer preferences,increased competition and the maturation of our business.Accordingly,you sho
177、uld not rely on our netsales growth rates for any prior period as an indicator of our future performance.Our overall growth in net sales will depend on manyfactors,including our ability to:1)Price our products and services effectively so that we can attract new customers and expand our relationships
178、 with existing customers.2)Accurately forecast our net sales and plan our operating expenses.3)Compete successfully with other companies that are or may be entering our competitive market in the future and respond todevelopments in those competitors,such as pricing changes and the introduction of ne
179、w products and services.4)Complying with existing and new laws and regulations that apply to our business.5)Successfully expanding into existing markets and entering new markets,including new geographic areas and categories.6)The successful introduction of new products and enhancements to our produc
180、ts and services and their features,including in response tonew trends or competitive dynamics or customer needs or preferences.7)Successfully identifying and acquiring or investing in businesses,products or technologies that we believe will complement or expandour business.8)Avoiding disruptions or
181、interruptions in the distribution of our products and services.9)Providing quality support to our customers that meets their needs.10)Hiring,integrating and retaining talented sales,customer service and other personnel.11)Effectively managing the growth of our business,personnel and operations,inclu
182、ding the opening of new showrooms.12)Effectively managing the costs associated with our business and operations.13)Maintaining and enhancing our reputation and brand value.112023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/d
183、ata/1964603/0000002/yuezhonghuif1.htm17/110As filed with the Securities and Exchange Commission on February 6,2023.Because of our limited history of operating our business at our current scale,it is difficult to assess our current operations and futureprospects,including our ability to pl
184、an for and model future growth.Our limited operating experience at this scale,combined with therapidly evolving nature of the markets in which we sell our products and services,the significant uncertainty about how these markets willdevelop and other economic factors beyond our control,reduces our a
185、bility to accurately forecast quarterly or annual revenues.Failure toeffectively manage our future growth could adversely affect our business,financial condition and results of operations.We have limited sources of working capital and will need substantial additional financing.The working capital re
186、quired to implement our business strategy and R&D efforts will most likely be provided by funds obtained throughofferings of our equity,debt,debt-linked securities,and/or equity-linked securities,and revenues generated by us.No assurance can begiven that we will have revenues sufficient to sustain o
187、ur operations or that we would be able to obtain equity/debt financing in the currenteconomic environment.If we do not have sufficient working capital and are unable to generate sufficient revenues or raise additional funds,we may delay the completion of or significantly reduce the scope of our curr
188、ent business plan;delay some of our development and clinicalor marketing efforts;postpone the hiring of new personnel;or,under certain dire financial circumstances,substantially curtail or cease ouroperations.We may need to engage in capital-raising transactions in the near future.Such financing tra
189、nsactions may well cause substantial dilution toour shareholders and could involve the issuance of securities with rights senior to the outstanding shares.Our ability to complete additionalfinancings is dependent on,among other things,the state of the capital markets at the time of any proposed offe
190、ring,market reception of theCompany and the likelihood of the success of its business model and offering terms.There is no assurance that we will be able to obtainany such additional capital through asset sales,equity or debt financing,or any combination thereof,on satisfactory terms or at all.Addit
191、ionally,no assurance can be given that any such financing,if obtained,will be adequate to meet our capital needs and to support ouroperations.If we do not obtain adequate capital on a timely basis and on satisfactory terms,our revenues and operations and the value ofour Ordinary Shares and Ordinary
192、Share equivalents would be materially negatively impacted and we may cease our operations.We are dependent on certain key personnel and loss of these key personnel could have a material adverse effect on our business,financial condition and results of operations.Our success is,to a certain extent,at
193、tributable to the management,sales and marketing,and research and development expertise of keypersonnel.We are dependent upon the services of Mr.Chengsheng Feng,our Chairman of the Board,for the continued growth andoperation of our Company,due to his industry experience,technical expertise,as well a
194、s his personal and business contacts in the PRC.Additionally,Mr.Xiaodong Song,performs key functions in the operation of our business.We may not be able to retain Mr.ChengshengFeng and Mr.Xiaodong Song for any given period of time.Although we have no reason to believe that Mr.Chengsheng Feng and Mr.
195、Xiaodong Song will discontinue their services with us,the interruption or loss of his services would adversely affect our ability toeffectively run our business and pursue our business strategy as well as our results of operations.We do not carry key man life insurance forany of our key personnel,no
196、r do we foresee purchasing such insurance to protect against the loss of key personnel.Our success depends on our ability to protect our intellectual property.Our success depends on our ability to obtain and maintain patent protection for products developed utilizing our technologies,in the PRCand i
197、n other countries,and to enforce these patents.There is no assurance that any of our existing and future patents will be held valid andenforceable against third-party infringement or that our products will not infringe any third-party patent or intellectual property.We ownpatents and have filed addi
198、tional patent applications with the Patent Administration Department of the PRC;however,there is no assurancethat our filed patent applications will be granted.122023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/
199、0000002/yuezhonghuif1.htm18/110As filed with the Securities and Exchange Commission on February 6,2023.Any patents relating to our technologies may not be sufficiently broad to protect our products.In addition,our patents may be challenged,potentially invalidated or potentially circumvent
200、ed.Our patents may not afford us protection against competitors with similar technology orpermit the commercialization of our products without infringing third-party patents or other intellectual property rights.We also rely on or intend to rely on our trademarks,trade names and brand names to disti
201、nguish our products from the products of ourcompetitors,and have registered or will apply to register a number of these trademarks.However,third parties may oppose our trademarkapplications or otherwise challenge our use of the trademarks.In the event that our trademarks are successfully challenged,
202、we could beforced to rebrand our products,which could result in loss of brand recognition and could require us to devote resources to advertising andmarketing these new brands.Further,our competitors may infringe our trademarks,or we may not have adequate resources to enforce ourtrademarks.In additi
203、on,we also have trade secrets,non-patented proprietary expertise and continuing technological innovation that we shall seek toprotect,in part,by entering into confidentiality agreements with licensees,suppliers,employees and consultants.These agreements may bebreached and there may not be adequate r
204、emedies in the event of a breach.Disputes may arise concerning the ownership of intellectualproperty or the applicability of confidentiality agreements.Moreover,our trade secrets and proprietary technology may otherwise becomeknown or be independently developed by our competitors.If patents are not
205、issued with respect to products arising from research,we maynot be able to maintain the confidentiality of information relating to these products.If we fail to maintain an effective quality control system,our business could be materially and adversely affected.We place great emphasis on product qual
206、ity and adhere to stringent quality control measures and have obtained quality control certificationsfor our products.To meet our customers requirements and expectations for the quality and safety of our products,we have adopted astringent quality control system to ensure that every step of the prod
207、uction process is strictly monitored and managed.Failure to maintainan effective quality control system or to obtain or renew our quality standards certifications may result in a decrease in demand for ourproducts or cancellation or loss of purchase orders from our customers.Moreover,our reputation
208、could be impaired.As a result,ourbusiness and results of operations could be materially and adversely affected.The global coronavirus COVID-19 pandemic has caused significant disruptions in our business,which may continue to materiallyand adversely affect our results of operations and financial cond
209、ition.On March 11,2020,the World Health Organization declared the COVID-19 outbreak a global pandemic.Many businesses and socialactivities in China and other countries and regions were severely disrupted in 2020,including those of our suppliers,customers andemployees.This pandemic has also caused ma
210、rket panics,which materially and negatively affected the global financial markets,such as theplunge of global stocks on major stock exchanges in March 2020.Such disruption and slowdown of the worlds economy in 2020 andbeyond had,and may continue to have,a material adverse effect on our results of op
211、erations and financial condition.We and our customersexperienced significant business disruptions and suspension of operations due to quarantine measures to contain the spread of thepandemic,which caused shortage in the supply of raw materials,reduced our production capacity,increased the likelihood
212、 of default fromour customers and delayed our product delivery.All of these had resulted in a material adverse effect on our results of operations andfinancial condition in the fiscal year 2021.The extent to which the COVID-19 pandemic may impact our business,operations and financialresults will dep
213、end on numerous evolving factors that the Company cannot accurately predict at this time,including the uncertainty on thepotential resurgence of the COVID-19 cases in China,the continual spread of the virus globally,and the instability of local and globalgovernment policies and restrictions.We are c
214、losely monitoring the development of the COVID-19 pandemic and continuously evaluatingany further potential impact on our business,results of operations and financial condition.If the pandemic persists or escalates,we may besubject to further negative impact on our business operations and financial
215、condition.132023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm19/110As filed with the Securities and Exchange Commission on February 6,2023.A severe or prolonged downturn in th
216、e global or Chinese economy could materially and adversely affect our business and ourfinancial condition.Although the Chinese economy expanded well in the last two decades,the rapid growth of the Chinese economy has slowed down since2012,and there is considerable uncertainty over the long-term effe
217、cts of the expansionary monetary and fiscal policies adopted by thePeoples Bank of China and financial authorities of some of the worlds leading economies,including the United States and China.Therehave been concerns over unrest and terrorist threats in the Middle East,Europe and Africa,which have r
218、esulted in volatility in oil and othermarkets.There have also been concerns on the relationship among China and other Asian countries,which may result in or intensifypotential conflicts in relation to territorial disputes.Economic conditions in China are sensitive to global economic conditions,as we
219、ll aschanges in domestic economic and political policies and the expected or perceived overall economic growth rate in China.Any severe orprolonged slowdown in the global or Chinese economy may materially and adversely affect our business,results of operations and financialcondition.Risks Related to
220、 Doing Business in China The Chinese government exerts substantial influence over the manner in which we must conduct our business activities.We arecurrently not required to obtain approval from Chinese authorities to list on U.S exchanges,however,if our subsidiaries or theholding company were requi
221、red to obtain approval in the future and were denied permission from Chinese authorities to list onU.S.exchanges,we will not be able to continue listing on U.S.exchange,which would materially affect the interest of the investors.Because of our corporate structure as a United Kingdom holding company
222、with operations conducted by our PRC subsidiaries,it involvesunique risks to investors.Furthermore,Chinese regulatory authorities could change the rules and regulations regarding foreign ownership inthe industry in which the company operates,which would likely result in a material change in our oper
223、ations and/or a material change in thevalue of the securities we are registering for sale,including that it could cause the value of such securities to significantly decline or becomeworthless.The Chinese government has exercised and continues to exercise substantial control over virtually every sec
224、tor of the Chineseeconomy through regulation and state ownership.Under the current government leadership,the government of the PRC has been pursuingreform policies which have adversely affected China-based operating companies whose securities are listed in the United States,withsignificant policies
225、changes being made from time to time without notice.There are substantial uncertainties regarding the interpretationand application of PRC laws and regulations,including,but not limited to,the laws and regulations governing our business,or theenforcement and performance of our contractual arrangemen
226、ts with borrowers in the event of the imposition of statutory liens,death,bankruptcy or criminal proceedings.Our ability to operate in China may be harmed by changes in its laws and regulations,including thoserelating to taxation,environmental regulations,land use rights,property and other matters.T
227、he central or local governments of thesejurisdictions may impose new,stricter regulations or interpretations of existing regulations that would require additional expenditures andefforts on our part to ensure our compliance with such regulations or interpretations.Accordingly,government actions in t
228、he future,including any decision not to continue to support recent economic reforms and to return to a more centrally planned economy or regional orlocal variations in the implementation of economic policies,could have a significant effect on economic conditions in China or particularregions thereof
229、,and could require us to divest ourselves of any interest we then hold in Chinese properties.142023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm20/110As filed with the Securit
230、ies and Exchange Commission on February 6,2023.Given recent statements by the Chinese government indicating an intent to exert more oversight and control over offerings that areconducted overseas and/or foreign investment in China-based issuers,any such action could significantly limit or completely
231、 hinder ourability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or become worthless.Recently,the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointlyissued
232、the Opinions on Severely Cracking Down on Illegal Securities Activities According to Law,or the Opinions,which was madeavailable to the public on July 6,2021.The Opinions emphasized the need to strengthen the administration over illegal securities activities,and the need to strengthen the supervisio
233、n over overseas listings by Chinese companies.Effective measures,such as promoting theconstruction of relevant regulatory systems,will be taken to deal with the risks and incidents of China-concept overseas listed companies.As of the date of this prospectus,we have not received any inquiry,notice,wa
234、rning,or sanctions from PRC government authorities inconnection with the Opinions.On June 10,2021,the Standing Committee of the National Peoples Congress of China,or the SCNPC,promulgated the PRC Data SecurityLaw,which took effect in September 2021.The PRC Data Security Law imposes data security and
235、 privacy obligations on entities andindividuals carrying out data activities,and introduces a data classification and hierarchical protection system based on the importance ofdata in economic and social development,and the degree of harm it will cause to national security,public interests,or legitim
236、ate rights andinterests of individuals or organizations when such data is tampered with,destroyed,leaked,illegally acquired or used.The PRC DataSecurity Law also provides for a national security review procedure for data activities that may affect national security and imposes exportrestrictions on
237、certain data an information.In early July 2021,regulatory authorities in China launched cybersecurity investigations with regard to several China-based companies thatare listed in the United States.The Chinese cybersecurity regulator announced on July 2 that it had begun an investigation of Didi Glo
238、balInc.(NYSE:DIDI)and two days later ordered that the companys app be removed from smartphone app stores.On July 5,2021,theChinese cybersecurity regulator launched the same investigation on two other Internet platforms,Chinas Full Truck Alliance of Full TruckAlliance Co.Ltd.(NYSE:YMM)and Boss of KAN
239、ZHUN LIMITED(Nasdaq:BZ).On July 24,2021,the General Office of theCommunist Party of China Central Committee and the General Office of the State Council jointly released the Guidelines for FurtherEasing the Burden of Excessive Homework and Off-campus Tutoring for Students at the Stage of Compulsory E
240、ducation,pursuant towhich foreign investment in such firms via mergers and acquisitions,franchise development,and variable interest entities are banned fromthis sector.On August 17,2021,the State Council promulgated the Regulations on the Protection of the Security of Critical Information Infrastruc
241、ture,or the Regulations,which took effect on September 1,2021.The Regulations supplement and specify the provisions on the security ofcritical information infrastructure as stated in the Cybersecurity Review Measures.The Regulations provide,among others,that protectiondepartment of certain industry
242、or sector shall notify the operator of the critical information infrastructure in time after the identification ofcertain critical information infrastructure.On August 20,2021,the SCNPC promulgated the Personal Information Protection Law of the PRC,or the Personal Information ProtectionLaw,which too
243、k effect in November 2021.As the first systematic and comprehensive law specifically for the protection of personalinformation in the PRC,the Personal Information Protection Law provides,among others,that(i)an individuals consent shall be obtainedto use sensitive personal information,such as biometr
244、ic characteristics and individual location tracking,(ii)personal information operatorsusing sensitive personal information shall notify individuals of the necessity of such use and impact on the individuals rights,and(iii)where personal information operators reject an individuals request to exercise
245、 his or her rights,the individual may file a lawsuit with aPeoples Court.152023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm21/110As filed with the Securities and Exchange Com
246、mission on February 6,2023.As such,the Companys business segments may be subject to various government and regulatory interference in the provinces in whichthey operate.The Company could be subject to regulation by various political and regulatory entities,including various local and municipalagenci
247、es and government sub-divisions.The Company may incur increased costs necessary to comply with existing and newly adoptedlaws and regulations or penalties for any failure to comply.Additionally,the governmental and regulatory interference could significantlylimit or completely hinder our ability to
248、offer or continue to offer securities to investors and cause the value of such securities tosignificantly decline or be worthless.Furthermore,it is uncertain when and whether the Company will be required to obtain permission from the PRC government to list on U.S.exchanges in the future,and even whe
249、n such permission is obtained,whether it will be denied or rescinded.Although the Company iscurrently not required to obtain permission from any of the PRC federal or local government to obtain such permission and has not receivedany denial to list on the U.S.exchange,our operations could be adverse
250、ly affected,directly or indirectly,by existing or future laws andregulations relating to its business or industry.On December 24,2021,the CSRC,together with other relevant government authorities in China issued the Provisions of the State Councilon the Administration of Overseas Securities Offering
251、and Listing by Domestic Companies(Draft for Comments),and the Measures for theFiling of Overseas Securities Offering and Listing by Domestic Companies(Draft for Comments)(“Draft Overseas Listing Regulations”).The Draft Overseas Listing Regulations requires that a PRC domestic enterprise seeking to i
252、ssue and list its shares overseas(“OverseasIssuance and Listing”)shall complete the filing procedures of and submit the relevant information to CSRC.The Overseas Issuance andListing includes direct and indirect issuance and listing.Where an enterprise whose principal business activities are conducte
253、d in PRC seeksto issue and list its shares in the name of an overseas enterprise(“Overseas Issuer”)on the basis of the equity,assets,income or othersimilar rights and interests of the relevant PRC domestic enterprise,such activities shall be deemed an indirect overseas issuance and listing(“Indirect
254、 Overseas Issuance and Listing”)under the Draft Overseas Listing Regulations.Therefore,the proposed listing would be deemedan Indirect Overseas Issuance and Listing under the Draft Overseas Listing Regulations.As such,the Company would be required tocomplete the filing procedures of and submit the r
255、elevant information to CSRC after the Draft Overseas Listing Regulations becomeeffective.In addition,on December 28,2021,the CAC,the National Development and Reform Commission(“NDRC”),and several otheradministrations jointly issued the revised Measures for Cybersecurity Review,or the Revised Review
256、Measures,which became effectiveand has replaced the existing Measures for Cybersecurity Review on February 15,2022.According to the Revised Review Measures,if an“online platform operator”that is in possession of personal data of more than one million users intends to list in a foreign country,it mus
257、tapply for a cybersecurity review.Based on a set of Q&A published on the official website of the State Cipher Code Administration inconnection with the issuance of the Revised Review Measures,an official of the said administration indicated that an online platformoperator should apply for a cybersec
258、urity review prior to the submission of its listing application with non-PRC securities regulators.Giventhe recency of the issuance of the Revised Review Measures and their pending effectiveness,there is a general lack of guidance andsubstantial uncertainties exist with respect to their interpretati
259、on and implementation.For example,it is unclear whether the requirement ofcybersecurity review applies to follow-on offerings by an“online platform operator”that is in possession of personal data of more than onemillion users where the offshore holding company of such operator is already listed over
260、seas.Furthermore,the CAC released the draft ofthe Regulations on Network Data Security Management in November 2021 for public consultation,which among other things,stipulatesthat a data processor listed overseas must conduct an annual data security review by itself or by engaging a data security ser
261、vice providerand submit the annual data security review report for a given year to the municipal cybersecurity department before January 31 of thefollowing year.If the draft Regulations on Network Data Security Management are enacted in the current form,we,as an overseas listedcompany,will be requir
262、ed to carry out an annual data security review and comply with the relevant reporting obligations.162023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm22/110As filed with the Se
263、curities and Exchange Commission on February 6,2023.As of the date of this prospectus,none of our PRC subsidiaries operations involve storing of personal information of PRC individualclients.However,given the above uncertainties,it is unclear how the Revised Review Measures and the final draft Regul
264、ations on NetworkData Security Management will affect us.We have been closely monitoring the development in the regulatory landscape in China,particularly regarding the requirement of approvals,including on a retrospective basis,from the CSRC,the CAC or other PRC authoritieswith respect to this offe
265、ring,as well as regarding any annual data security review or other procedures that may be imposed on us.If anyapproval,review or other procedure is in fact required,we are not able to guarantee that we will obtain such approval or complete suchreview or other procedure timely or at all.For any appro
266、val that we may be able to obtain,it could nevertheless be revoked and the terms ofits issuance may impose restrictions on our operations and offerings relating to our securities.Changes in Chinas economic,political or social conditions or government policies could have a material adverse effect on
267、ourbusiness and results of operations.Substantially all of our operations are located in China.Accordingly,our business,prospects,financial condition,and results of operationsmay be influenced significantly by political,economic,and social conditions in China generally and by continued economic grow
268、th inChina as a whole.The Chinese economy differs from the economies of most developed countries in many respects,including the amount of governmentinvolvement,level of development,growth rate,control of the foreign exchange,and allocation of resources.Although the Chinesegovernment has implemented
269、measures emphasizing the utilization of market forces for economic reform,the reduction of state ownershipof productive assets,and the establishment of improved corporate governance in business enterprises,a substantial portion of productiveassets in China is still owned by the government.In additio
270、n,the Chinese government continues to play a significant role in regulatingindustry development by imposing industrial policies.The Chinese government also exercises significant control over Chinas economicgrowth through allocating resources,controlling payment of foreign currency-denominated obliga
271、tions,setting monetary policy,andproviding preferential treatment to particular industries or companies.While the Chinese economy has experienced significant growth over the past decades,growth has been uneven,both geographically andamong various sectors of the economy.The Chinese government has imp
272、lemented various measures to encourage economic growth andguide the allocation of resources.Some of these measures may benefit the overall Chinese economy but may harm us.For example,ourfinancial condition and results of operations may be adversely affected by government control over capital investm
273、ents or changes in taxregulations.In addition,in the past,the Chinese government has implemented certain measures,including interest rate increases,to controlthe pace of economic growth.These measures may cause decreased economic activity in China,and since 2012,Chinas economic growthhas slowed down
274、.Any prolonged slowdown in the Chinese economy may reduce the demand for our products and services and materiallyand adversely affect our business and results of operations.We may also decide to finance our PRC subsidiaries using capital contributions.The Ministry of Commerce(“MOC”)or its localcount
275、erpart must approve these capital contributions.On March 30,2015,the State Administration of Foreign Exchange,or SAFE,promulgated Circular of the State Administration of Foreign Exchange on Reforming the Management Approach regarding the Settlementof Foreign Exchange Capital of Foreign-invested Ente
276、rprises,or Circular 19,which expands a pilot reform of the administration of thesettlement of the foreign exchange capitals of foreign-invested enterprises nationwide.Circular 19 came into force and replaced previousCircular 142 and Circular 36 on June 1,2015.On June 9,2016,SAFE promulgated the Circ
277、ular of the State Administration of ForeignExchange on Reforming and Regulating Policies on the Control over Foreign Exchange Settlement of Capital Accounts,or Circular 16,tofurther expand and strengthen such reform.Under Circular 19 and Circular 16,foreign-invested enterprises in the PRC are allowe
278、d to usetheir foreign exchange funds under capital accounts and RMB funds from exchange settlement for expenditure under current accountswithin its business scope or expenditure under capital accounts permitted by laws and regulations,except that such funds shall not be usedfor(i)expenditure beyond
279、the enterprises business scope or expenditure prohibited by laws and regulations;(ii)investments in securities orother investments than principal-secured products issued by banks;(iii)granting loans to non-affiliated enterprises,except where it isexpressly permitted in the business license;and(iv)co
280、nstruction or purchase of real estate for purposes other than self-use(except for realestate enterprises).In addition,SAFE strengthened its oversight of the flow and use of the RMB capital converted from foreign currencyregistered capital of a foreign-invested company.The use of such RMB capital may
281、 not be altered without SAFEs approval,and such RMBcapital may not,in any case,be used to repay RMB loans if the proceeds of such loans have not been used.Violations of these circularscould result in severe monetary or other penalties.These circulars may significantly limit our ability to use RMB co
282、nverted from the cashprovided by our offshore financing activities to fund the establishment of new entities in China by our PRC subsidiaries,to invest in oracquire any other PRC companies through our PRC subsidiaries.172023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezho
283、nghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm23/110As filed with the Securities and Exchange Commission on February 6,2023.In light of the various requirements imposed by PRC regulations on loans to and direct investment in PRC entities by offshore ho
284、ldingcompanies,we cannot assure you that we will be able to complete the necessary government registrations or obtain the necessarygovernment approvals on a timely basis,if at all,with respect to future loans to our PRC subsidiaries or future capital contributions by us toour PRC subsidiaries.If we
285、fail to complete such registrations or obtain such approvals,our ability to use the proceeds we expect to receivefrom our initial public offering to capitalize or otherwise fund our PRC operations may be negatively affected,which could materially andadversely affect our liquidity and our ability to
286、fund and expand our business.The PRC government may impose restrictions on our ability to transfer cash out of China and to U.S.investors.The PRC government imposes controls on the convertibility of Renminbi into foreign currencies and,in certain cases,the remittance ofcurrency out of China.To the e
287、xtent that our income is received in Renminbi,shortages in foreign currencies may restrict our ability to paydividends or other payments,or otherwise satisfy our foreign currency denominated obligations,if any.Under existing PRC foreignexchange regulations,payments of current account items,including
288、 profit distributions,interest payments and expenditures from trade-related transactions,can be made in foreign currencies without prior approval from the State Administration of Foreign Exchange,orSAFE,as long as certain procedural requirements are met.Approval from appropriate government authoriti
289、es is required if Renminbi isconverted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreigncurrencies.The PRC government may,at its discretion,impose restrictions on access to foreign currencies for current account transactions
290、.To address persistent capital outflows and the RMBs depreciation against the U.S.dollar in the fourth quarter of 2016,the Peoples Bank ofChina and the SAFE implemented a series of capital control measures in the subsequent months,including stricter vetting procedures forChina-based companies to rem
291、it foreign currency for overseas acquisitions,dividend payments and shareholder loan repayments.The PRCgovernment may continue to strengthen its capital controls and our PRC subsidiaries dividends and other distributions may be subject totightened scrutiny in the future.The PRC government also impos
292、es controls on the conversion of RMB into foreign currencies and theremittance of currencies out of the PRC.Therefore,we may experience difficulties in completing the administrative procedures necessaryto obtain and remit foreign currency for the payment of dividends from our profits,if any.Furtherm
293、ore,there can be no assurance that thePRC government will not intervene or impose restrictions on our ability to transfer or distribute cash within our organization or to foreigninvestors,which could result in an inability or prohibition on making transfers or distributions outside of China or Hong
294、Kong andadversely affect our business as well as your investment.As of the date of this prospectus,we are not aware of other material restrictions and limitations on our ability to distribute earnings fromour businesses,including our subsidiaries,to the parent company and U.S.investors or our abilit
295、y to settle amounts owed,or on foreignexchange or our ability to transfer cash between entities within our group,across borders,or to U.S.investors.182023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/000196460323
296、000002/yuezhonghuif1.htm24/110As filed with the Securities and Exchange Commission on February 6,2023.To the extent cash or assets of our business,or of our PRC or Hong Kong subsidiaries,is in the PRC or Hong Kong,such cash orassets may not be available to fund operations or for other use outside of
297、 the PRC or Hong Kong,due to interventions in or theimposition of restrictions and limitations by the PRC government to the transfer of cash or assets.The transfer of funds and assets among Yuezhonghui,its Hong Kong and PRC subsidiaries is subject to restrictions.The PRC governmentimposes controls o
298、n the conversion of the RMB into foreign currencies and the remittance of currencies out of the PRC.In addition,thePRC Enterprise Income Tax Law and its implementation rules provide that a withholding tax at a rate of 10%will be applicable todividends payable by Chinese companies to non-PRC-resident
299、 enterprises,unless reduced under treaties or arrangements between the PRCcentral government and the governments of other countries or regions where the non-PRC-resident enterprises are tax resident.As of the date of this prospectus,there are no restrictions or limitations imposed by the Hong Kong g
300、overnment on the transfer of capitalwithin,into and out of Hong Kong(including funds from Hong Kong to the PRC),except for the transfer of funds involving moneylaundering and criminal activities.However,there is no guarantee that the Hong Kong government will not promulgate new laws orregulations th
301、at may impose such restrictions in the future.As a result of the above,to the extent cash or assets of our business,or of our PRC or Hong Kong subsidiaries,is in the PRC or HongKong,such funds or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong,due to i
302、nterventionsin or the imposition of restrictions and limitations by the PRC government to the transfer of cash or assets.PRC laws and regulations governing our current business operations are sometimes vague and uncertain and any changes in suchlaws and regulations may impair our ability to operate
303、profitably.There are substantial uncertainties regarding the interpretation and application of PRC laws and regulations including,but not limited to,the laws and regulations governing our business and the enforcement and performance of our arrangements with customers in certaincircumstances.The laws
304、 and regulations are sometimes vague and may be subject to future changes,and their official interpretation andenforcement may involve substantial uncertainty.The effectiveness and interpretation of newly enacted laws or regulations,includingamendments to existing laws and regulations,may be delayed
305、,and our business may be affected if we rely on laws and regulations whichare subsequently adopted or interpreted in a manner different from our understanding of these laws and regulations.New laws andregulations that affect existing and proposed future businesses may also be applied retroactively.W
306、e cannot predict what effect theinterpretation of existing or new PRC laws or regulations may have on our business.Substantial uncertainties exist with respect to the enactment timetable and final content of draft China Foreign Investment Lawand how it may impact the viability of our current corpora
307、te structure,corporate governance and business operations.The MOFCOM published a discussion draft of the proposed Foreign Investment Law in January 2015(the“Draft FIL”).The Draft FILembodies an expected Chinese regulatory trend to rationalize its foreign investment regulatory regime in line with pre
308、vailing internationalpractice and the legislative efforts to unify the corporate legal requirements for both foreign and domestic investments.Among other things,the Draft FIL expands the definition of foreign investment and introduces the principle of“actual control”indetermining whether a company i
309、s considered a foreign-invested enterprise(“FIE”).The Draft FIL specifically provides that entitiesestablished in China but“controlled”by foreign investors will be treated as FIEs,whereas an entity set up in a foreign jurisdiction wouldnonetheless be,upon market entry clearance,treated as a Chinese
310、domestic investor provided that the entity is“controlled”by Chineseentities and/or citizens.Once an entity is determined to be an FIE,it will be subject to the foreign investment restrictions or prohibitions setforth in a Negative List to be separately issued by the State Council later.Unless the un
311、derlying business of the FIE falls within theNegative List,which calls for market entry clearance,prior approval from the government authorities as mandated by the existing foreigninvestment legal regime would no longer be required for establishment of the FIE.192023/2/9https:/www.sec.gov/Archives/e
312、dgar/data/1964603/0000002/yuezhonghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm25/110As filed with the Securities and Exchange Commission on February 6,2023.On December 27,2021,the NDRC and MOFCOM,jointly issued the Special Administrative Mea
313、sures for Entry of Foreign Investment(Negative List)(2021 Version),or the Negative List,which became effective and replaced the previous version on January 1,2022.Pursuant to the Negative List,if a PRC company,which engages in any business where foreign investment is prohibited under the NegativeLis
314、t,or prohibited businesses,seeks an overseas offering or listing,it must obtain the approval from competent governmental authorities.Based on a set of Q&A published on the NDRCs official website,a NDRC official indicated that after a PRC company submits itsapplication for overseas listing to the CSR
315、C and where matters relating to prohibited businesses under the Negative List are implicated,theCSRC will consult the regulatory authorities having jurisdiction over the relevant industries and fields.Because the Overseas Listing Rules are currently in draft form and given the novelty of the Negativ
316、e List,there remain substantialuncertainties as to whether and what requirements,including filing requirements,will be imposed on a PRC company with respect to itslisting and offerings overseas as well as with the interpretation and implementation of existing and future regulations in this regard.Fo
317、rexample,it is unclear as to whether the approval requirement under the Negative List will apply to follow-on offerings by PRC companiesengaged in prohibited businesses and whose offshore holding company is listed overseas.If such approval is in fact required and given theNDRCs indication of CSRCs i
318、nvolvement in the approval process,there is also a lack of clarity on the application procedure,requirementand timeline which may not be resolved until the Overseas Listing Rules,which provide for the filing procedures of the overseas offeringand listing of a PRC company with the CSRC,is enacted.If
319、the Overseas Listing Rules are enacted in the current form before thecompletion of this offering,we will be required to make a filing with the CSRC in connection with this offering within three business daysafter its completion.If the approval requirement under the Negative List applies to follow-on
320、 offerings by PRC companies whose offshoreholding company is listed overseas,we may be required to obtain an approval for this offering or we may be required to relinquish ourlicenses pertaining to prohibited businesses.If we relinquish or are required to relinquish these licenses,while we do not ex
321、pect ourbusiness operation to be materially adversely affected,we are uncertain whether or when the relevant procedures will be completed.There are uncertainties under the PRC laws relating to the procedures for U.S.regulators to investigate and collect evidence fromcompanies located in the PRC.Acco
322、rding to Article 177 of the newly amended PRC Securities Law which became effective in March 2020(the“Article 177”),thesecurities regulatory authority of the PRC State Council may collaborate with securities regulatory authorities of other countries or regionsin order to monitor and oversee cross bo
323、rder securities activities.Article 177 further provides that overseas securities regulatory authoritiesare not allowed to carry out investigation and evidence collection directly within the territory of the PRC,and that any Chinese entities andindividuals are not allowed to provide documents or mate
324、rials related to securities business activities to overseas agencies without priorconsent of the securities regulatory authority of the PRC State Council and the competent departments of the PRC State Council.Our PRC counsel,King&Wood Mallesons,has advised us of their understanding that(i)the Articl
325、e 177 is applicable in the limitedcircumstances related to direct investigation or evidence collection conducted by overseas authorities within the territory of the PRC(insuch case,the foregoing activities are required to be conducted through collaboration with or by obtaining prior consent of compe
326、tentChinese authorities);(ii)the Article 177 does not limit or prohibit the Company,as a company duly incorporated in United Kingdom and tobe listed on Nasdaq,from providing the required documents or information to Nasdaq or the SEC pursuant to applicable Listing Rules andU.S.securities laws;and(iii
327、)as the Article 177 is relatively new and there is no implementing rules or regulations which have beenpublished regarding application of the Article 177,it remains unclear how the law will be interpreted,implemented or applied by theChinese Securities Regulatory Commission or other relevant governm
328、ent authorities.As of the date hereof,we are not aware of anyimplementing rules or regulations which have been published regarding application of Article 177.However,we cannot assure you thatrelevant PRC government agencies,including the securities regulatory authority of the PRC State Council,would
329、 reach the sameconclusion as we do.As such,there are uncertainties as to the procedures and time requirement for the U.S.regulators to bring aboutinvestigations and evidence collection within the territory of the PRC.202023/2/9https:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhon
330、ghuif1.htmhttps:/www.sec.gov/Archives/edgar/data/1964603/0000002/yuezhonghuif1.htm26/110As filed with the Securities and Exchange Commission on February 6,2023.Our principal business operation is conducted in the PRC.In the event that the U.S.regulators carry out investigation on us and t
331、here is aneed to conduct investigation or collect evidence within the territory of the PRC,the U.S.regulators may not be able to carry out suchinvestigation or evidence collection directly in the PRC under the PRC laws.The U.S.regulators may consider cross-border cooperationwith securities regulator
332、y authority of the PRC by way of judicial assistance,diplomatic channels or regulatory cooperation mechanismestablished with the securities regulatory authority of the PRC.We rely on dividends,loans and other distributions on equity paid by our PRC subsidiaries to fund any cash and financingrequirem
333、ents we may have.Any limitation on the ability of our PRC subsidiaries to make loans or payments to us could have amaterial adverse effect on our ability to conduct our business.We are a holding company and rely on dividends,loans and other distributions on equity paid by our PRC subsidiaries for our cash andfinancing requirements,including the funds necessary to pay dividends and other cash distr