Company: CAAS
Filing Date: 2025-08-04
Form Type: 424B3
Source: 0001104659-25-073486
Chunk: 55

Company: China Automotive Systems, Inc.
Filing Date: 2025-08-04
Form: 424B3
Chunk 55
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-Identified Issuer
for two consecutive years in the future. If our securities are prohibited from trading in the United States, there is no certainty that
we will be able to list on a non-U.S. exchange or that a market for our securities will develop outside of the United States. A prohibition
of being able to trade in the United States would substantially impair your ability to sell or purchase our securities when you wish
to do so, and the risk and uncertainty associated with delisting would have a negative impact on the price of our securities. Also, such
a prohibition would significantly affect our ability to raise capital on terms acceptable to us, or at all, which would have a material
adverse impact on our business, financial condition, and prospects.

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The non-U.S. activities of the Company’s non-U.S. subsidiaries may be subject to U.S. taxation.

The majority of the Company’s subsidiaries
are based in China and are subject to income taxes in the PRC. These China-based subsidiaries conduct substantially all of the Company’s
operations, and generate most of the Company’s income in China. The Company is a Delaware corporation and is subject to income
tax in the United States, and following the Redomicile Merger, CAAS Cayman will continue to be subject to income tax in the United States.
Under applicable U.S. federal income tax law, certain activities conducted in the PRC or other jurisdictions outside of the U.S. may
give rise to U.S. corporate income tax. These U.S. taxes would be imposed on CAAS Cayman when its subsidiaries that are controlled foreign
corporations (“CFCs”) generate income that is subject to Subpart F of the U.S. Internal Revenue Code (“Subpart F”)
or considered “global intangible low-taxed income,” or “GILTI”, even if such income is not distributed to CAAS
Cayman. Passive income, such as rents, royalties, interest, dividends, and gain from disposal of investments, is among the types of income
subject to taxation under Subpart F. Any income taxable under Subpart F is taxable in the U.S. at federal corporate income tax rates
of up to 21 percent.

GILTI generally refers to foreign income in excess
of a deemed return on tangible assets of CFCs, subject to the possible use of foreign tax credits and a deduction equal to 50 percent
(scheduled to decline to