Company: CAAS
Filing Date: 2025-07-25
Form Type: F-4/A
Source: 0001104659-25-070492
Chunk: 56

Company: China Automotive Systems, Inc.
Filing Date: 2025-07-25
Form: F-4/A
Chunk 56
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 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 37.5 percent beginning in 2026) to offset the income tax liability, subject to some limitations.

Information technology dependency and cyber security vulnerabilities could lead to reduced revenue, liability claims, or competitive harm.

The Company is dependent on information technology
systems and infrastructure, or “IT systems”, to conduct its business. The Company’s IT systems may be vulnerable to
disruptions from human error, outdated applications, computer viruses, natural disasters, unauthorized access, cyber-attack and other
similar disruptions. Any significant disruption, breakdown, intrusion, interruption or corruption of these systems or data breaches could
cause the loss of data or intellectual property, equipment damage, downtime, and/or safety related issues and could have a material adverse
effect on the Company’s business. The Company has, from time to time, experienced incidents related to its IT systems, and expect
that such incidents will continue, including malware and computer virus outbreaks, unauthorized access, systems failures and disruptions.
The Company has measures and defenses in place against such events, but the Company may not be able to prevent, immediately detect, or
remediate all instances of such events. A material security breach or disruption of the Company’s IT systems could result in theft,
unauthorized use, or publication of the Company’s intellectual property and/or confidential business information, harm the Company’s
competitive position, disrupt the Company’s manufacturing, reduce the value of the Company’s investment in research and development
and other strategic initiatives, impair the Company’s ability to access vendors and suppliers or otherwise adversely affect the
Company’s business