Company: DDC
Filing Date: 2025-08-05
Form Type: F-3/A
Source: 0001213900-25-072059
Chunk: 137

Company: DDC Enterprise Ltd
Filing Date: 2025-08-05
Form: F-3/A
Chunk 137
---
 past decade, U.S. SEC
and PCAOB and the Chinese counterparts, namely, the China Securities Regulatory Commission, or the CSRC, and PRC Ministry of Finance have
been in an impasse over the ability of the PCAOB to have access to the audit work papers and inspect the audit work of China based accounting
firms, including our auditor. In May 2013, the PCAOB entered into a Memorandum of Understanding on Enforcement Cooperation (the “MOU”)
with the CSRC, and the PRC Ministry of Finance, which establishes a cooperative framework between the parties for the production and exchange
of audit documents relevant to investigations undertaken by the PCAOB, the CSRC or the PRC Ministry of Finance in the United States
and the PRC, respectively. Despite the MOU, on December 7, 2018, the SEC and the PCAOB issued a joint statement highlighting continued
challenges faced by the U.S. regulators in their oversight of financial statement audits of U.S.-listed companies with significant
operations in China. On April 21, 2020, the SEC and the PCAOB reiterated in another joint statement the greater risk associated with
the PCAOB’s inability to inspect audit work paper and practices of accounting firms in China, with respect to their audit work of
U.S. reporting companies.

As part of a continued regulatory
focus in the United States on access to audit and other information currently protected by laws in China, on December 2, 2020,
U.S. Congress passed S. 945, the Holding Foreign Companies Accountable Act. The HFCAA has been signed by the President into law.
Pursuant to the HFCAA, the SEC is required to propose rules to prohibit the securities of any registrant from being listed on any of the
U.S. securities exchanges or traded “over the counter” if the PCAOB is unable to inspect the work of the accounting firm
for three consecutive years. On March 24, 2021, the SEC issued amendments to Form 20 and sought public comment in response
to the HFCAA. Consistent with the HFCAA, these amendments require the submission of documentation to the SEC establishing that a
“commission-identified registrant” (as defined in the amendments) is not owned or controlled by a governmental entity in that
foreign jurisdiction and also require disclosure in a foreign issuer’s annual report regarding the audit arrangements of, and governmental
influence on, such registrant. We will be