Company: XHG
Filing Date: 2025-01-22
Form Type: 20-F
Source: 0001213900-25-005499
Chunk: 86

Company: XChange TEC.INC
Filing Date: 2025-01-22
Form: 20-F
Item: Item 4
Chunk 86
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 be subject to intellectual property infringement claims or other allegations by third parties,
which may materially and adversely affect our business, results of operations and prospects.”

Seasonality

We generally experience
a lower transaction volume for our insurance agency business during the first quarter of a given year due to holiday seasons in China,
and remain relatively stable for the remaining threequarters of the year.

Regulations

We operate in an increasingly complex legal and
regulatory environment. We are subject to a variety of PRC and foreign laws, rules and regulations across numerous aspects of our business.
This section sets forth a summary of the principal PRC laws, rules and regulations relevant to our business and operations in the PRC.

Regulation of Insurance Agencies

The principal regulation governing professional
insurance agencies is the Provisions on the Regulation of Insurance Agencies, effective from January 1, 2021. The Provisions on
the Regulation of Insurance Agencies regulate market access, operating rules, market exit, monitoring and inspection, and legal obligations
for insurance agencies.

According to the Provisions on the Regulation
of Insurance Agencies, “insurance agencies” refers to organizations or individuals that are entrusted by an insurance company
and collect commissions from the insurance company to handle the insurance business on an agency basis within the scope authorized by
the insurance company, including professional insurance agencies, sideline insurance agencies and individual insurance agents.

To establish a professional insurance agency,
the minimum registered capital depends on its business region. For professional insurance agencies whose business regions are not limited
to the province, autonomous region, municipality directly under the central government, or city specifically designated in the state
plan where they are registered, the minimum registered capital should be RMB50 million, while for those operating within the province,
autonomous region, municipality directly under the central government, or city specifically designated in the state plan where they are
registered, the minimum registered capital should be RMB20 million. The registered capital of a professional insurance agency must be
paid-in monetary capital. An insurance professional agency must obtain an Insurance Agent Operating License.

A professional insurance agency may engage in
the following insurance agency businesses:

  selling insurance products on behalf of the insurer  

  collecting insurance premiums on behalf of the insurer  

  conducting loss surveys and handling claims of insurance  

  other business activities specified by the CBIRC.  

According to the Notice to Overhaul Chaotic Auto
Insurance Market (the “ Overhaul Notice”), promulgated by the CBIRC on July 6, 2017, all property insurance companies
must intens