Company: CAAS
Filing Date: 2025-07-25
Form Type: F-4/A
Source: 0001104659-25-070492
Chunk: 51

Company: China Automotive Systems, Inc.
Filing Date: 2025-07-25
Form: F-4/A
Chunk 51
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’s operations and financial results.

The Company receives most of its revenues in
Chinese Renminbi, “RMB”. A portion of such revenues will be converted into other currencies to meet the Company’s
foreign currency obligations. Foreign exchange transactions under the Company’s capital account, including principal payments
in respect of foreign currency-denominated obligations, continue to be subject to significant foreign exchange controls and require
the approval of the State Administration of Foreign Exchange in China. These limitations could affect the Company’s ability to
obtain foreign exchange through debt or equity financing, or to obtain foreign exchange for capital expenditures. The Chinese
government controls its foreign currency reserves through restrictions on imports and conversion of RMB into foreign currency. Any
significant appreciation of the RMB is likely to decrease the income of export products and the cash flow of the Company.

Because the Chinese legal system is different from the legal system in United States, the Company and its security holders’ legal protections may be limited.

The Chinese legal system is based on written statutes
and their interpretation by the Supreme People’s Court. As the Chinese legal system is evolving rapidly, the interpretation, implementation
and enforcement of laws and regulations involve uncertainties. In addition, as the Chinese legal system develops, changes in such laws
and regulations, their interpretation or their enforcement may have a material adverse effect on the Company’s business operations.
Moreover, interpretative case law does not have the same precedential value in China as in the United States, so legal compliance in China
may be more difficult or expensive.

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The Company may be subject to fines and legal sanctions imposed by State Administration of Foreign Exchange, “SAFE”, or other Chinese government authorities if it or its Chinese directors or employees fail to comply with Chinese regulations relating to employee share options or shares granted by offshore listed companies to Chinese domestic individuals.

On December 25, 2006, the People’s Bank
of China, or PBOC, issued the Administration Measures on Individual Foreign Exchange Control, and the corresponding Implementation Rules were
issued by SAFE on January 5, 2007. Both of these regulations became effective on February 1, 2007. According to these regulations,
all foreign exchange matters relating to employee stock holding plans, share option plans or similar plans with Chinese domestic individuals’
participation require approval from the SAFE or its authorized branch. On February 15, 2012, SAFE promulgated the Notices on Issues
Concerning the Foreign Exchange Administration for Domestic Individuals Participating in