Company: OCG
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-043484
Chunk: 29

Company: Oriental Culture Holding LTD
Filing Date: 2025-05-15
Form: 20-F
Item: Item 4
Chunk 29
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 (Negative List) for Foreign Investment Access (2024 Edition) (the “2024
National Negative List”) on September 6, 2024, which took effect on November 1, 2024 and the Special Administrative Measures
(Negative List) for Foreign Investment Access in Pilot Free Trade Zones (2021 Edition) (the “2021 FTZ Negative List”) on December 27, 2021, which took effect on January 1, 2022. The 2024 Negative
Lists prescribe that any domestic enterprise engaging in businesses prohibited by the Negative Lists that lists, issues securities and
trades shares overseas must obtain pre-approval consent from relevant competent regulator; overseas investors must not engage in the operation
and management of the enterprise, and the percentage of foreign shareholding is subject to the relevant provisions in the administrative
measures for domestic securities investments by foreign investors. The Foreign Investment Law provides that foreign invested entities
operating in foreign restricted or prohibited industries will require market entry clearance and other approvals from relevant PRC governmental
authorities.

Though the business we conduct through the variable
interest entity is not within the category in which foreign investment is currently restricted or prohibited under the Negative List or
other PRC Laws, we expect that in the future Jiangsu Yanggu might engage in services that are within the category in which foreign investment
is restricted pursuant to the Negative List. In addition, we intend to centralize our management and operation in the PRC to avoid being
restricted from conducting certain business activities which are important for our current or future business but are currently restricted
or might be restricted in the future. As such, we believe the VIE agreements between the WFOE and the variable interest entity are necessary
and essential for our business operations without the equity ownership of VIE. These contractual arrangements with the variable interest
entity and its shareholders enable us to exercise effective control over the variable interest entity and hence consolidate their financial
results as the VIE without being deemed as a foreign invested company.

PRC Laws and Regulations relating to Wholly Foreign-owned Enterprises

The establishment, operation and management of
companies in the PRC are mainly governed by the Company Law, which was issued by the Standing Committee of the National People’s
Congress and was last amended in December 2023. The revised Company Law will take into effect in July 2024. The Company Law applies to
both PRC domestic companies and foreign-invested companies. The investment activities in China of foreign investors are also