Company: GURE
Filing Date: 2025-04-11
Form Type: 10-K
Source: 0001193805-25-000461
Chunk: 26

Company: GULF RESOURCES, INC.
Filing Date: 2025-04-11
Form: 10-K
Item: Item 1
Chunk 26
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received notification from the Government of Yangkou Town, Shouguang City of PRC that production at all its factories must be halted immediately.
This was required for the Company to perform rectification and improvement in compliance with the local new safety and environmental protection
requirements.

The Company has worked closely
with the county authorities to develop rectification plans for its bromine and crude salt businesses, reaching an agreement on a plan
in October 2017. During the fiscal year ended December 31, 2018, the Company incurred $16,243,677 in the rectification and improvements
of plant and equipment of the bromine and crude salt factories resulting in a cumulative amount of $34,182,329 incurred as of December
31, 2018. The Shouguang City Bromine Association, on behalf of all the bromine producers in Shouguang, initiated negotiations with the
local government agencies. The local governmental agencies acknowledged the facts that their initial requirements for the bromine industry
did not include the project, the planning and land use rights approvals, which were later introduced by the provincial government as new
requirements. The Company understood from the local government that local government were coordinating with various government agencies
to solve these three outstanding approval issues in a timely manner and that all impacted bromine plants are not allowed to commence production
prior to obtaining those approvals. In April 2019, Factory No.1, Factory No.5 and Factory No.7 (Factory no. 5 is considered part of Factory
no.7 and both are managed as one factory since 2010) resumed operations upon receipt of verbal notification from local government of Yangkou
County. Then, on May 7, 2019, the Company renamed its Subdivision Factory No. 1 to Factory No. 4; and Factory No. 5 (previously integrated
with Factory No. 7) as the new Factory No. 7.

On November
25, 2019, the government of Shouguang City issued a notice ordering all bromine facilities in Shouguang City, including the Company’s
all bromine facilities, including Factory No.1 and Factory No. 7, to temporarily stop production from December 16, 2019 to February 10,
2020. Subsequently, due to the coronavirus outbreak in China, the local government ordered those bromine facilities to postpone the commencement
of production. Subsequently, the Company received an approval dated on