Company: GLXG
Filing Date: 2025-10-24
Form Type: 20-F
Source: 0001213900-25-102144
Chunk: 12

Company: Galaxy Payroll Group Ltd
Filing Date: 2025-10-24
Form: 20-F
Item: Item 3
Chunk 12
---
 subject of any unfavorable allegations, whether
such allegations are proven to be true or untrue, we will have to expend significant resources to investigate such allegations and/or
defend our company. This situation will be costly and time consuming and distract our management from developing our growth. If such allegations
are not proven to be groundless, we and our business operations will be severely affected and you could sustain a significant decline
in the value of our share.

The enactment of the Law of the PRC on Safeguarding
National Security in the Hong Kong Special Administrative Region (the “ Hong Kong National Security Law”) could impact our
Hong Kong operating subsidiary.

On June 30, 2020, the Standing
Committee of the PRC National People’s Congress adopted the Hong Kong National Security Law. This law defines the duties and government
bodies of the Hong Kong National Security Law for safeguarding national security and four categories of offenses - secession, subversion,
terrorist activities, and collusion with a foreign country or external elements to endanger national security - and their corresponding
penalties. On July 14, 2020, U. S. President Donald Trump signed the Hong Kong Autonomy Act (“ HKAA”) into law, authorizing
the U. S. administration to impose blocking sanctions against individuals and entities who are determined to have materially contributed
to the erosion of Hong Kong’s autonomy. On August 7, 2020, the U. S. government imposed HKAA-authorized sanctions on 11 individuals,
including the then HKSAR chief executive, Carrie Lam, and, John Lee, who succeeded to HKSAR chief executive on July 1, 2022. On October
14, 2020, the U. S. State Department submitted to relevant committees of Congress the report required under HKAA, identifying persons materially
contributing to “the failure of the Government of China to meet its obligations under the Joint Declaration or the Basic Law.”
In July 2021, President Joe Biden warned investors about the risks of doing business in Hong Kong, issuing an advisory saying China’s
push to exert more control over Hong Kong threatens the rule of law and endangers employees and data. The HKAA further authorizes secondary
sanctions, including the imposition of blocking sanctions, against foreign financial institutions that knowingly conduct a significant
transaction with foreign persons sanctioned under this authority. The imposition of sanctions may directly affect the foreign financial
institutions as well as any third parties or customers dealing with any foreign financial