Company: APM
Filing Date: 2025-04-30
Form Type: 20-F
Source: 0001213900-25-037669
Chunk: 79

Company: Aptorum Group Ltd
Filing Date: 2025-04-30
Form: 20-F
Item: Item 3
Chunk 79
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. House of Representatives, all call for additional
and more stringent criteria to be applied to emerging market companies. These developments could add uncertainties to our offering, business
operations, share price and reputation.

U. S. public companies that
have substantially all of their operations in China and Hong Kong have been the subject of intense scrutiny, criticism and negative publicity
by investors, financial commentators and regulatory agencies, such as the SEC. Much of the scrutiny, criticism and negative publicity
has centered on financial and accounting irregularities and mistakes, a lack of effective internal controls over financial accounting,
inadequate corporate governance policies or a lack of adherence thereto and, in many cases, allegations of fraud.

On April 21, 2020, SEC Chairman
Jay Clayton and PCAOB Chairman William D. Duhnke III, along with other senior SEC staff, released a joint statement highlighting the risks
associated with investing in companies based in or have substantial operations in emerging markets including China, including Hong Kong,
reiterating past SEC and PCAOB statements on matters including the difficulty associated with inspecting accounting firms and audit work
papers in China and Hong Kong and higher risks of fraud in emerging markets and the difficulty of bringing and enforcing SEC, Department
of Justice and other U. S. regulatory actions, including in instances of fraud, in emerging markets generally.

On May 20, 2020, the U. S.
Senate passed the HFCA Act requiring a foreign company to certify it is not owned or controlled by a foreign government if the PCAOB is
unable to audit specified reports because the company uses a foreign auditor not subject to PCAOB inspection. If the PCAOB is unable to
inspect the company’s auditors for three consecutive years, the issuer’s securities are prohibited to trade on a national
exchange. On December 2, 2020, the U. S. House of Representatives approved the HFCA Act.

On May 21, 2021, Nasdaq filed
three proposals with the SEC to (i) apply minimum offering size requirement for companies primarily operating in a “ Restrictive
Market”, (ii) prohibit Restrictive Market companies from directly listing on Nasdaq Capital Market, and only permit them to list
on Nasdaq Global Select or Nasdaq Global Market in connection with a direct listing and (iii) apply additional and more stringent criteria
to an applicant or listed company based on the qualifications of the company’s auditors.

On March 24, 2021, the SEC
ann