Company: DTSQ
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001641172-25-001417
Chunk: 73

Company: DT Cloud Star Acquisition Corp
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1
Chunk 73
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corporate governance standards in some countries are weak in that they do not prevent business practices that cause unfavorable related
party transactions, over-leveraging, improper accounting, family company interconnectivity and poor management. Local laws often do not
go far enough to prevent improper business practices. Therefore, shareholders may not be treated impartially and equally as a result
of poor management practices, asset shifting, conglomerate structures that result in preferential treatment to some parts of the overall
company, and cronyism. The lack of transparency and ambiguity in the regulatory process also may result in inadequate credit evaluation
and weakness that may precipitate or encourage financial crisis. In our evaluation of a business combination, we will have to evaluate
the corporate governance of a target and the business environment, and in accordance with United States laws for reporting companies
take steps to implement practices that will cause compliance with all applicable rules and accounting practices. Notwithstanding these
intended efforts, there may be endemic practices and local laws that could add risk to an investment we ultimately make and that result
in an adverse effect on our operations and financial results.

46

Risks
Associated with Acquiring and Operating a Target Business with its Primary Operations in China 

As
set forth herein, our efforts in identifying a prospective target business will not be limited to a particular country. We may target
an initial business combination with a company located in China. Because of such potential ties to China, we may be subjected to Chinese
laws, rules and regulations. Accordingly, in addition to the risk factors referred above, we have set forth some of the primary risks
we have identified in seeking to consummate our initial business combination with a company having its primary operations in China.

The
PRC government has indicated its intent to intervene in or influence a PRC company’s business operations at any time or to exert
more oversight and control over offerings conducted overseas and foreign investment in PRC-based issuers. This could result in a material
change in a PRC company’s business operations post-business combination and/or the value of its securities. Additionally, governmental
and regulatory interference could significantly limit or completely hinder a target company’s ability to offer or continue to offer
securities to investors post-business combination and cause the value of such securities to significantly decline or be worthless.

Our
sponsor is predominantly controlled by a PRC national, and we may seek to acquire a company that is based in China in an initial business
combination. We may be subject to certain risks relating to regulatory oversight