Company: DDC
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-043916
Chunk: 44

Company: DDC Enterprise Ltd
Filing Date: 2025-05-15
Form: 20-F
Item: Item 3
Chunk 44
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 can
be inconsistent and unpredictable. In addition, the PRC legal system is based in part on government policies and internal rules, some
of which are not published on a timely basis or at all, and which may have a retroactive effect. As a result, we may not be aware of our
violation of these policies and rules until after the occurrence of the violation.

Any administrative and court
proceedings in China may be protracted, resulting in substantial costs and diversion of resources and management attention. Since PRC
administrative and court authorities have significant discretion in interpreting and implementing statutory and contractual terms, it
may be more difficult to evaluate the outcome of administrative and court proceedings and the level of legal protection we enjoy than
in more developed legal systems. These uncertainties may impede our ability to enforce the contracts we have entered into and could materially
and adversely affect our business, financial condition and results of operations.

In addition, the Opinions
jointly issued by the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council
on July 6, 2021 called for strengthened regulation over illegal securities activities and supervision of overseas listings by China-based
companies and propose to take effective measures. As of the date of this annual report, no official guidance and related implementation
rules have been issued in relation to these recently issued opinions and the interpretation and implementation of the Opinions remain
unclear at this stage.

On December 28, 2021, the
Cyberspace Administration of China (the “ CAC”), and 12 other relevant PRC government authorities published the amended Cybersecurity
Review Measures, which came into effect on February 15, 2022. The final Cybersecurity Review Measures provide that a “network platform
operator” that possesses personal information of more than one million users and seeks a listing in a foreign country must apply
for a cybersecurity review. Further, the relevant PRC governmental authorities may initiate a cybersecurity review against any company
if they determine certain network products, services or data processing activities of such company affect or may affect national security.
Through the contractual arrangements with Weishi, DDC Shanghai had collected and possessed personal information of more than one million
users. After the contractual arrangements with Weishi were terminated in April 2022, DDC Shanghai still have been possessing this amount
of personal information which are stored in mainland China. For purposes of the Cybersecurity Review Measures, we have applied for and
completed the cybersecurity review with