Company: CAAS
Filing Date: 2025-07-01
Form Type: F-4
Source: 0001104659-25-064447
Chunk: 131

Company: China Automotive Systems, Inc.
Filing Date: 2025-07-01
Form: F-4
Chunk 131
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 established/incorporated
under the laws of a foreign jurisdiction but has its “de facto management body” in the PRC. A non-resident enterprise refers
to an enterprise which was established/incorporated under the laws of a foreign jurisdiction and does not have its “de facto management
body” in the PRC, but has an establishment or place in the PRC, or has China-sourced income even though it does not have any establishment
or place in the PRC.

Under the implementation rules of the EIT
Law, “de facto management body” is defined as an organization that has material and overall management and control over the
business, personnel, accounts and properties of an enterprise. In April 2009, the SAT issued a Notice on Issues Relating to Determination
of PRC-Controlled Offshore Enterprises as PRC Resident Enterprises Based on “De Facto Management Body” Test, or SAT Circular
No. 82, under which, an offshore enterprise controlled by a PRC enterprise or a PRC enterprise group will be characterized as a “resident
enterprise” due to the fact that its “de facto management body” is located within the PRC, if all of the following conditions
are met at the same time: (i) the senior management personnel responsible for its daily operations and the place where the senior
management departments discharge their responsibilities are located primarily in the PRC, (ii) its finance and human resources related
decisions are made by or are subject to the approval of institutions or personnel located in the PRC, (iii) its major assets, books
and records, company seals and minutes of its board of directors and shareholder meetings are located or kept in the PRC, and (iv) senior
management personnel or 50% or more of the members of its board of directors with voting power of the enterprise reside in the PRC. SAT
Circular No. 82 further specifies that the principle of “substance over form” shall be adopted in determining whether
the “de facto management body” is located within China.

We currently are not treated as a PRC resident
enterprise by the Chinese tax authority and as a result, we have not withheld PRC income taxes from our foreign investors and as a non-resident
enterprise, we are subject to PRC withholding tax if we receive dividends directly from our PRC subsidiaries paid by them using funds
out of their profits generated on and after January 1, 2008.

Nevertheless, a significant portion