Company: LHI
Filing Date: 2025-11-20
Form Type: F-1/A
Source: 0001213900-25-112807
Chunk: 146

Company: Living Homeopathy International Ltd.
Filing Date: 2025-11-20
Form: F-1/A
Chunk 146
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 Pyramid Schemes Prohibition Ordinance which defines a pyramid scheme as a scheme in which: (1) new participants
must provide a participation payment to a participant or promoter of the scheme; (2) the participation payment is entirely or substantially
induced by the prospect that the new participant will be entitled to a recruitment payment; and (3) the recruitment payment is entirely
or substantially derived from the introduction to the scheme of a further new participant. Our mentor-mentee program was a business model
that we believe was suitable for our business development which serves as our marketing and sales network as well as a network that we
can leverage to gradually enhance public awareness of homeopathy and our products. For example, public awareness of homeopathy by word
of mouth and acceptance of homeopathy is critical to our business success, and we believe the mentor-mentee network benefits customer
education to enhance market awareness of homeopathy and our homeopathic products as alternative treatment to conventional medicines with
a focus on holistic physical and emotional therapy. See “Risk Factors – Risks related to our Business and Industry
-- Unfavorable publicity or consumer acceptance of our products generally could reduce our sales” on page 17 of this prospectus
for more details. In addition, the one-off membership fee of HKD500 (US$63.9) is a nominal amount which we mainly use to fund the education
and training for the members with regard to homeopathy and other administrative fees, and the economic benefits of participants are substantially
the entitlement to product discounts and sales commissions associated with product sales. See “Risk Factors – Risks Related to our Business - If the relevant laws and regulations regulating “Pyramid Scheme” become increasingly broad on the scope of Pyramid Schemes, there will be more pressure on compliance cost, managerial resources, and business, and our business, financial conditions, and results of operations will be materially and adversely affected” on page 20 of this prospectus, and “Regulation -
Regulations Related to our Business Operation in Hong Kong” on page 84 of this prospectus for more details. For the year ended
March 31, 2024 and 2025, total commissions to our mentors and mentees amounted to $3,011,692 and $2,996,092, respectively.

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We have set up mentor-mentee program-related code of conduct to regulate mentor and mentee conducts and delineate their rights and obligations, setting for the mechanism on compliance