Company: PAVS
Filing Date: 2025-08-04
Form Type: 20-F
Source: 0001929980-25-000590
Chunk: 11

Company: Paranovus Entertainment Technology Ltd.
Filing Date: 2025-08-04
Form: 20-F
Item: Item 3
Chunk 11
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 aspects of its business, including its own TikTok shops and its service offerings to third-party merchants. The social commerce industry is rapidly evolving and characterized by low barriers to entry, frequent innovation, and shifting consumer and platform dynamics. As a result, BW competes with a wide range of players, including other social commerce retailers, multi-channel networks (MCNs), livestreaming agencies, influencer marketing firms, and digital advertising solution providers.

In its own product sales channels, BW competes for consumer attention, traffic, and conversion with both established brands and individual content creators who manage their own online stores. Success in this environment depends heavily on the ability to produce engaging content, manage effective livestreams, and respond quickly to evolving trends. BW may face pressure to reduce pricing or increase promotional activity, which could erode its margins or require higher marketing expenditure.

In its e-commerce enablement services, BW competes for merchant clients with a growing number of third-party service providers offering livestreaming support, KOL engagement, advertising placement, and analytics tools. Many of these competitors may have longer operating histories, greater financial resources, deeper relationships with platforms, or stronger technological capabilities. Some merchants may also choose to develop in-house capabilities to manage content, KOLs, and digital marketing, reducing the demand for outsourced services.

In addition, platform operators such as TikTok may offer their own native marketing and commerce tools to brands, potentially disintermediating third-party service providers like BW. As competition intensifies, BW may be required to lower its pricing, offer more favorable commercial terms, or increase investment in talent, tools, and content production - each of which may adversely impact its financial performance.

If BW fails to compete effectively across its business lines, or is unable to differentiate its services and maintain strong relationships with merchants, KOLs, and platform partners, its market position, revenue growth, and profitability could be materially and adversely affected.

BW’s operations may be adversely affected by evolving regulations related to digital advertising, data privacy, and influencer marketing.

BW engages in various activities that are subject to increasing regulatory scrutiny, including livestreaming sales, digital advertising placements, use of third-party influencers (KOLs), and data analytics services. Governments and regulatory authorities in BW’s key markets, including the United States, have introduced or are considering new laws and regulations aimed at strengthening consumer protection, regulating influencer disclosures, ensuring transparency in online advertising, and protecting personal data.

For example, changes to rules requiring clearer disclosure of paid promotions, restrictions on