Company: KPEA
Filing Date: 2025-01-14
Form Type: 10-K
Source: 0001493152-25-002124
Chunk: 7

Company: Kun Peng International Ltd.
Filing Date: 2025-01-14
Form: 10-K
Item: Item 3
Chunk 7
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 vehicles to hold KP International. Such SAFE
registration was effected on May 14, 2021. These shareholders of King Eagle (Tianjin) were also required to register their equity pledge
arrangement by the Equity Pledge Agreement with King Eagle (China). However, the Company faces uncertainty with respect to future actions
by the PRC government that could significantly affect King Eagle (Tianjin)’s financial performance and the enforceability of the
VIE Agreements.

On
July 6, 2021, the PRC government issued the Opinions on Strictly Cracking Down on Illegal Securities Activities, calling for: (i) tightening
oversight of data security, cross-border data flow and administration of classified information, as well as amendments to relevant regulations
to specify responsibilities of overseas listed Chinese companies with respect to data security and information security; (ii) enhanced
oversight of overseas listed companies as well as overseas equity fundraising and listing by Chinese companies; and (iii) extraterritorial
application of China’s securities laws. As the Opinions on Strictly Cracking Down on Illegal Securities Activities were recently
issued, there is great uncertainty with respect to the interpretation and implementation thereof. We will closely monitor further developments.

In
addition, on July 10, 2021, the Cyberspace Administration of China (the “CAC”) issued the Measures for Cybersecurity Review,
or the Measures, which proposed to authorize the relevant government authorities to conduct cybersecurity review on a range of activities
that affect or may affect national security, including listings in foreign countries by companies that possess the personal data of more
than one million users. On January 4, 2022, the CAC issued the New Measures for Cybersecurity Review (the “New Measures”),
which amended the Measures for Cybersecurity Review (Draft Revisions) released on July 10, 2021. As our VIE has less than one million
customers, we believe that the Measures are not applicable to us in current form. The PRC government is increasingly focused on data
security, recently launching cybersecurity review against a number of mobile apps operated by several US-listed Chinese companies and
prohibiting these apps from registering new users during the review period. There are great uncertainties regarding the interpretation
and enforcement of PRC laws, rules, and regulations regarding data and privacy security. We may be required to change our data and other
business practices and be subject to regulatory investigations, penalties, increased cost of operations