Company: ILAG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001641172-25-006445
Chunk: 42

Company: Intelligent Living Application Group Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 3
Chunk 42
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 defend our company. This situation may be a major
distraction to our management. If such allegations are not proven to be groundless, our business operations will be severely hindered
and your investment in our ordinary shares could be rendered worthless.

Risks Related to Doing Business in Hong Kong.

The Hong Kong legal system embodies uncertainties
which could negatively affect our listing on Nasdaq and limit the legal protections available to you and us.

As one of the conditions for the handover of the sovereignty
of Hong Kong to China, China had to accept some conditions such as Hong Kong’s Basic Law before its return. The Basic Law ensured
Hong Kong will retain its own currency (the Hong Kong Dollar), legal system, parliamentary system and people’s rights and freedom
for fifty years from 1997. This agreement has given Hong Kong the freedom to function in a high degree of autonomy. The Special Administrative
Region of Hong Kong is responsible for its own domestic affairs including, but not limited to, the judiciary and courts of last resort,
immigration and customs, public finance, currencies and extradition. Hong Kong continues using the English common law system.

However, if the PRC reneges on its agreement to allow
Hong Kong to function autonomously, this could potentially impact Hong Kong’s common law legal system and may in turn bring about
uncertainty in, for example, listing our ordinary shares on Nasdaq Stock Exchange.

This also could materially and adversely affect our
business and operation. Additionally, intellectual property rights and confidentiality protections in Hong Kong may not be as effective
as in the United States or other countries. Accordingly, we cannot predict the effect of future developments in the Hong Kong legal system,
including the promulgation of new laws, changes to existing laws or the interpretation or enforcement thereof, or the preemption of local
regulations by national laws. These uncertainties could limit the legal protections available to us, including our ability to enforce
our agreements with our customers.

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Any social unrest in Hong Kong may affect our business and financial
results.

Hong Kong is a special administrative region of the
PRC with its own government. Hong Kong enjoys a high degree of autonomy from the PRC under the principle of “one country, two systems.”
However, there can be no assurance that our financial condition and results of operations will not be adversely affected as a consequence
of the exercise of PRC sovereignty over Hong Kong. In particular, in 2019 and 2020, there has been a series of large