Company: QSJC
Filing Date: 2025-03-26
Form Type: 10-K
Source: 0001683168-25-001892
Chunk: 101

Company: TANCHENG GROUP CO., LTD.
Filing Date: 2025-03-26
Form: 10-K
Item: Item 1A
Chunk 101
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 Control on Domestic Residents’ Offshore Investment and Financing and Roundtrip Investment
Through Special Purpose Vehicles, or SAFE Circular 37, to replace the Notice on Relevant Issues Concerning Foreign Exchange Administration
for Domestic Residents’ Financing and Roundtrip Investment Through Offshore Special Purpose Vehicles, or SAFE Circular 75, which
ceased to be effective upon the promulgation of SAFE Circular 37. SAFE Circular 37 requires PRC residents (including PRC individuals and
PRC corporate entities) to register with SAFE or its local branches in connection with their direct or indirect offshore investment activities.
SAFE Circular 37 is applicable to our shareholders who are PRC residents and may be applicable to any acquisitions of companies outside
of China that we make in the future.

Under SAFE Circular 37, PRC residents who make,
or have prior to the implementation of SAFE Circular 37 made, direct or indirect investments in offshore special purpose vehicles, or
SPVs, will be required to register such investments with SAFE or its local branches. In addition, any PRC resident who is a direct or
indirect shareholder of an SPV is required to update its filed registration with the local branch of SAFE with respect to that SPV, to
reflect any material change. Moreover, any subsidiary of such SPV in China is required to urge the PRC resident shareholders to update
their registration with the local branch of SAFE. If any PRC shareholder of such SPV fails to make the required registration or to update
the previously filed registration, the subsidiary of such SPV in China may be prohibited from distributing its profits or the proceeds
from any capital reduction, share transfer or liquidation to the SPV, and the SPV may also be prohibited from making additional capital
contributions into its subsidiary in China. On February 13, 2015, the SAFE promulgated a Notice on Further Simplifying and Improving Foreign
Exchange Administration Policy on Direct Investment, or SAFE Notice 13, which became effective on June 1, 2015. Under SAFE Notice 13,
applications for foreign exchange registration of inbound foreign direct investments and outbound overseas direct investments, including
those required under SAFE Circular 37, will be filed with qualified banks instead of SAFE. The qualified banks will directly examine the
applications and accept registrations under the supervision of SAFE.

Some of our shareholders that we are aware of
are subject to SAFE regulations, and we expect all of these shareholders will have completed all necessary registrations with the local
SAFE branch or qualified banks as required