Company: OCG
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-043484
Chunk: 52

Company: Oriental Culture Holding LTD
Filing Date: 2025-05-15
Form: 20-F
Item: Item 4
Chunk 52
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. An employer failing to do so may be liable to a fine and imprisonment.

C. Organizational structure

Below is the Company’s corporate structure chart as of the date
of this report.

Variable Interest Entity Arrangements

In establishing our business, we have used a
variable interest entity, or VIE, structure. In the PRC, investment activities by foreign investors are principally governed by the
NDRC and the MOFCOM which promulgated the Special Administrative Measures (Negative List) for Foreign Investment Access (2024
Edition) (the “2024 National Negative List”) on September 6, 2024, which took effect on November 1, 2024 and the Special
Administrative Measures (Negative List) for Foreign Investment Access in Pilot Free Trade Zones (2021 Edition) (the “2021 FTZ
Negative List”) on December 27, 2021, which took effect on January 1, 2022. Our Company and the WFOE are
considered as foreign investors or foreign invested enterprises under PRC law.

Though the business we conduct through the variable
interest entity is not within the category in which foreign investment is currently restricted or prohibited under the Negative List or
other PRC Laws, we expect that in the future Jiangsu Yanggu might engage in business that are within the category in which foreign investment
is restricted pursuant to the Negative List. In addition, we intend to centralize our management and operation in the PRC to avoid being
restricted in conducting certain business activities which are important for our current or future business but are currently restricted
or might be restricted in the future. As such, we believe the agreements between the WFOE and the variable interest entity are necessary
and essential for our business operation without the equity ownership of the VIE. These contractual arrangements with the variable interest
entity and its shareholders enable us to exercise effective control over the variable interest entity and hence consolidate the financial
results of the VIE and its wholly owned subsidiaries without being deemed as a foreign invested company.

In our case, the WFOE effectively assumed management
of the business activities of the variable interest entity through a series of agreements which are referred to as the VIE Agreements.
The VIE Agreements are comprised of a series of agreements, including a Technical Consultation and Service Agreement, an Equity Pledge
Agreement, an Equity Option Agreement, and a Voting Rights Proxy and Financial Supporting Agreement. Through the VIE Agreements, the WFOE