Company: TCOM
Filing Date: 2025-04-11
Form Type: 20-F
Source: 0001193125-25-078429
Chunk: 69

Company: Trip.com Group Ltd
Filing Date: 2025-04-11
Form: 20-F
Item: Item 3
Chunk 69
---
 to litigation to enforce our rights, which may be time-consuming and expensive. 
 As the PRC government restricts foreign ownership of the value-added telecommunications businesses in China, we depend on the VIEs, in which we have no ownership interest, to conduct part of our business activities through a series of contractual arrangements, which provide us with a “controlling financial interest” in the VIEs as defined in FASB ASC 810 by entitling us to (i) the power to direct activities of the VIEs that most significantly affect their economic performance, and (ii) the right to receive the economic benefits from the VIEs that could be significant to them. Although we have been advised by our PRC legal counsel, Commerce & Finance Law Offices, that the contractual arrangements as described in this annual report are valid, binding, and enforceable under current PRC laws, these arrangements are not as effective in providing control as direct ownership of these businesses. For example, the VIEs could violate our contractual arrangements with them by, among other things, failing to pay us for our consulting or other services. In any such event, we would have to rely on the PRC legal system for the enforcement of those agreements, which could have uncertain results. Any legal proceeding could result in the disruption of our business, damage to our reputation, diversion of our resources and incurrence of substantial costs. See “—Risks Relating to Multi-jurisdictional Operations—The PRC government’s significant oversight and discretion over our business operations and uncertainties with respect to the PRC legal system could result in a material adverse change in our operations and the value of our ADSs and ordinary shares.” 
 The principal shareholders of the VIEs have potential conflict of interest with us, which may adversely affect our business. 
 Some of our employees and senior consultants were also the principal shareholders of the VIEs as of the date of this annual report. Thus, conflict of interest between their duties to our company and their interests in the VIEs may arise. We cannot assure you that when conflict of interest arises, these persons will act entirely in our interests or that the conflict of interest will be resolved in our favor. In addition, these persons could violate their non-competition obligations under service contracts with us or their legal duties by diverting business opportunities from us to others, resulting in our loss of corporate opportunities. In any such event, we would have to rely on the PRC legal system for the enforcement of these agreements, which