Company: KPEA
Filing Date: 2025-01-14
Form Type: 10-K
Source: 0001493152-25-002124
Chunk: 676

Company: Kun Peng International Ltd.
Filing Date: 2025-01-14
Form: 10-K
Item: Item 1A
Chunk 676
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 resulting in substantial costs and diversion of resources and management attention. Since PRC
administrative and court authorities have significant discretion in interpreting and implementing statutory provisions and contractual
terms, it may be more difficult to evaluate the outcome of administrative and court proceedings and the level of legal protection we
enjoy than in more developed legal systems. These uncertainties may impede our ability to enforce the contracts we have entered into
and could materially and adversely affect our business and results of operations.

Furthermore,
the PRC legal system is based in part on government policies and internal rules, some of which are not published on a timely basis or
at all and may have retroactive effect. As a result, we may not be aware of our violation of any of these policies and rules until sometime
after the violation. Such unpredictability towards our contractual, property (including intellectual property) and procedural rights
could adversely affect our business and impede our ability to continue our operations.

We
may face obstacles from the communist system in the PRC.

Foreign
companies conducting operations in the PRC face significant political, economic, and legal risks. The communist regime in the PRC may
hinder Western investment in the Company.

We
may have difficulty establishing adequate management, legal and financial controls in the PRC.

The
PRC historically has been deficient in Western style management and financial reporting concepts and practices, as well as in modern
banking, computer, and other control systems. We may have difficulty in hiring and retaining a sufficient number of qualified employees
to work in the PRC. As a result of these factors, we may experience difficulty in establishing management, legal and financial controls,
collecting financial data and preparing financial statements, books of account and corporate records and instituting business practices
that meet Western standards.

62

Our
business is subject to complex and evolving laws and regulations regarding privacy and data protection. These laws and regulations can
be complex and stringent, and many are subject to change and uncertain interpretation, which could result in claims, changes to our data
and other business practices, regulatory investigations, penalties, increased cost of operations, or declines in user growth or engagement,
or otherwise affect our business. Although we believe we currently are not required to obtain clearance from the Cyberspace Administration
of China under the recently enacted or proposed regulations or rules, we face uncertainties as to the interpretation or implementation
of such regulations or rules, and if required, whether such clearance can be timely obtained, or at all.

Regulatory
authorities in