Company: NEGG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001213900-25-036055
Chunk: 138

Company: Newegg Commerce, Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 10
Chunk 138
---
 is applicable to dividends paid to investors
that are non-resident enterprises, which do not have an establishment or place of business in the PRC or which have such establishment
or place of business but the dividends are not effectively connected with such establishment or place of business, to the extent such
dividends are derived from sources within the PRC. In addition, any gain realized on the transfer of shares by such investors is also
subject to PRC tax at a rate of 10%, if such gain is regarded as income derived from sources within the PRC. If we are deemed a PRC resident
enterprise, dividends paid on our common shares, and any gain realized from the transfer of our common shares, may be treated as income
derived from sources within the PRC and may as a result be subject to PRC taxation. Furthermore, if we are deemed a PRC resident enterprise,
dividends paid to individual investors who are non-PRC residents and any gain realized on the transfer of common shares by such investors
may be subject to PRC tax at a current rate of 20% (which in the case of dividends may be withheld at source). Any PRC tax liability may
be reduced under applicable tax treaties or tax arrangements between China and other jurisdictions. If we or any of our subsidiaries established
outside China are considered a PRC resident enterprise, it is unclear whether holders of our common shares would be able to claim the
benefit of income tax treaties or agreements entered into between China and other countries or areas.

U. S. Federal Income Taxation

We believe that we are an inverted corporation
for U. S. federal tax purposes. This means that, notwithstanding that we are a company incorporated in the BVI, we believe that we will
be treated for all U. S. federal tax purposes as if we are a U. S. corporation and that a holder of our common shares will be treated for
all U. S. federal tax purposes as holding the stock of a U. S. corporation.

The following discussion is a summary of certain
U. S. federal income tax considerations generally applicable to the ownership and disposition of our common shares but does not purport
to be a complete analysis of all potential tax effects. The effects of other U. S. federal tax laws, such as estate and gift tax laws,
and any applicable state or local tax laws are not discussed. This discussion is based on the Internal Revenue Code and U. S. Treasury
Regulations prom