Company: MKDWW
Filing Date: 2025-04-03
Form Type: 20-F
Source: 0001641172-25-002607
Chunk: 28

Company: MKDWELL Tech Inc.
Filing Date: 2025-04-03
Form: 20-F
Item: Item 3
Chunk 28
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law.

MKD’s
Taiwan entity is subject to foreign exchange control imposed by Taiwan authorities, which may affect the paying dividends, repatriating
the interest or making other payments to us.

Currently
Taiwan regulates only those foreign exchange transactions that involve the conversion of the New Taiwan Dollar into foreign currencies.
Pursuant to the relevant provisions of the Taiwan Foreign Exchange Control Act, foreign exchange transactions of a value of NTD 500,000
or more shall be declared to the Central Bank of Taiwan. Further, for a remittance by a company as follows, relevant testimonials shall
be submitted and such remittance shall be subject to the approval of the Central Bank of Taiwan: (i) a single remittance of an amount
over US$1 million; or (ii) annual accumulated settlement amount of foreign exchange purchased or sold has exceeded US$50 million. Nevertheless,
the Taiwan government may impose further foreign exchange restrictions in certain emergency situations, where the Taiwan government experiences
extreme difficulty in stabilizing the balance of payments or where there are substantial disturbances in the financial and capital markets
in Taiwan. If the dividend payments or other payments by MKD’s Taiwan subsidiaries and branches to us involves the currency conversion
from New Taiwan Dollar to United States Dollar, such conversion would be subject to the foregoing foreign exchange control imposed by
a Taiwan authority.

  16  

We
may be required to obtain approvals from Taiwan authority for investment in MKD’s Taiwan subsidiary if the shareholding of MKD
Taiwan reaches the threshold for such approval.

Under
current Taiwan laws, regulations and policy, the shareholder of MKD Taiwan will be required to obtain approval from the Investment Commission,
Ministry of Economic Affairs of Taiwan for its investment in its Taiwanese subsidiary if more than 30% of its capital is directly or
indirectly owned by, or beneficially owned by any PRC person or it is under control by any PRC person. Failure to obtain such approval,
if needed, may subject us to a Taiwan authority’s monetary penalty of from NTD120,000 to NTD25,000,000 and be ordered to rectify
within a specific timeline; if such approval is not applied for, the Taiwan authority may order investment withdrawal and operations
in Taiwan to be suspended.

MKD’s
Taiwan subsidiary bears product liabilities for damages caused by MKD’s products under Taiwan regulations on consumer protection.

Currently,
a portion of MKD’s products are manufactured and sold in Taiwan. Pursuant to the Taiwan Consumer