Company: ZLAB
Filing Date: 2025-04-18
Form Type: CORRESP
Source: 0001628280-25-018396
Chunk: 2

Company: Zai Lab Ltd
Filing Date: 2025-04-18
Form: CORRESP
Chunk 2
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 have indicated an intent to increase the government’s oversight and control over securities offerings of companies with significant operations in mainland China that are to be conducted in foreign markets, including the United States, as well as foreign investment in China-based issuers. Any such action by the Chinese government could significantly limit or completely hinder our ability to offer or continue to offer our securities to our investors and could cause the value of our securities to significantly decline or become worthless.

With regard to the disclosures in the Annual Report regarding how cash is transferred through the Company’s organization, we respectfully bring the Staff’s attention to the disclosures under the heading “Dividends and Other Distributions” on page 23 of the Annual Report and under the heading “We may rely on dividends and other distributions on equity paid by our Chinese subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our Chinese subsidiaries to make payments to us could have a material adverse effect on our business operations” on page 31 of the Annual Report. The Company has updated these disclosures since the annual report on Form 10-K for the year ended December 31, 2021 (the “2021 Annual Report”) for the purpose of eliminating duplicative disclosure and refocusing the disclosure on the potential impact to the Company of the relevant regulations that represent material risks, rather than on a fulsome and detailed explanation of the history of the regulations. Furthermore, the Company has retained and updated the explanation regarding cash flows through the Company. Consequently, the Company respectfully submits that the disclosure in the Annual Report complies with sample comments 4 and 9 of the Staff’s Sample Letter to China-Based Companies. Specifically, the Company respectfully submits that the existing disclosure provides a description of how cash is transferred through its organization; describes transfers, dividends, or distributions that have been made to date between the Company and its subsidiaries, quantifying the amount where applicable; and describes restrictions on foreign exchange and its ability to transfer cash between entities, across borders, and to U.S. investors. The Company’s corporate structure currently contains no VIEs (as disclosed under the heading “Zai Lab Limited is not a Chinese operating company, but a holding company incorporated in the Cayman Islands” prior to Item 1 of the Annual Report), and to date the Company has never declared or paid dividends on its ordinary shares (as disclosed in Item 5 on page 76 of the Annual Report), nor have there been any such dividends or other distributions from the Company’s Chinese subsidiaries to its subsidiaries located in or