Company: ILAG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001641172-25-006445
Chunk: 40

Company: Intelligent Living Application Group Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 3
Chunk 40
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Administration, effective on February 15, 2022, which provides that, Critical Information Infrastructure Operators (“ CIIOs”)
and Online Platform Operators engaging in data processing activities that affect or may affect national security shall be subject to the
cybersecurity review by the Cybersecurity Review Office. In addition, CIIOs and Online Platform Operators that possess personal data of
at least one (1) million users must apply for a review by the Cybersecurity Review Office, if they plan to conduct listings in foreign
countries. Although we are not an CIIO or an Online Platform Operator as
defined in the Review Measures, it is not certain whether any future regulations will impose restrictions on the business that we are
currently engaging in China, which is manufacturing lockset. As of the date of this report, we have not received any notice from any authorities
identifying us as a CIIO, Online Platform Operator or requiring us to undertake a cybersecurity review by the CAC.

On July 23, 2021, General Office of the State Council
promulgated “ Opinions on Further Reducing Students’ Homework Burden and After-school Tutoring Burden at the Stage of Compulsory
Education”, pursuant to which the institutions that offer tutoring of school curriculum shall be registered as non-profit organizations
and are not allowed to make profits and raise capital. The new regulation also disallows foreign investment in these institutions through
acquisitions, franchise or contractual agreements. Although we only manufacture lockset products in China and do not engage in CIIO, Online
Platform Operator or any education or tutoring related business, our stock price may be negatively affected by these
new regulations as they have materially negatively affected stock prices of the U. S listed Chinese companies which are the CIIOs, Online
Platform Operators or in the tutoring business. Any additional restriction, scrutiny or negative publicity of the U. S.-listed Chinese
companies could cause the U. S. investors less interested in our ordinary shares, or completely hinder our ability to offer our ordinary
shares to investors and cause the value of such securities to significantly decline or be worthless.

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Furthermore, the PRC government authorities may adopt
new rules and regulations and impose additional limitations or restrictions on us based on the industry that we operate in, for example,
the “dual control of energy consumption” policy to control the total power consumption and efficiency which has caused disruptions
to Xingfa’s production schedule in 2021, or more stringent environmental protection requirements for