Company: GURE
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001193805-25-001184
Chunk: 46

Company: GULF RESOURCES, INC.
Filing Date: 2025-08-13
Form: 10-Q
Item: Item 1
Chunk 46
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 and, based on verbal confirmation by local government
authorities, believes the administrative penalties imposed by the Bureau according to the Written Decisions are being re-assessed by local
government authorities and may be revoked. Pursuant to a Written Application dated October 28, 2019 addressed to the Court by the Bureau,
the Bureau withdrew its application for the enforcement proceedings regarding the administrative penalty imposed on Factory No. 7, Factory
No. 8 and Factory No.10. Pursuant to a written decisions of administrative ruling captioned (2019) Lu 0783 Xing Shen No. 389 Zhi Yi, dated
November 25, 2020, the Court orders to terminate the enforcement of the case captioned (2019) Lu 0783 Xing Shen No. 389. Production of
Factory No. 7 was allowed to resume in April 2019. The Company received a notification from the Shouguang City Government in February
2019 informing the Company that Factory No. 1, No. 4, No. 7 and No. 9 have passed inspection and were approved to resume operation.

In addition, on August 28, 2019, the People’s
Government of Shandong Province, issued a regulation titled “Investment Project Management Requirements of Chemical Companies in
Shandong Province” permitting the construction of facilities on existing sites or infrastructure of bromine manufacturing and other
chemical industry-related types of projects (clause 11 of section 3). The Company believes that the goal of the government is to standardize
and regulate the industry and not to demolish the facilities or penalize the manufacturers. As of the date of this report, the Company
has not been notified by the local government that it will take any measure to enforce the administrative penalties. Based on information
known to date, the Company believes that it is remote that the Written Decisions or Court Rulings will be enforced within the expected
timeframe and a material penalty or costs and expenses against the Company will result. However, there can be no assurance that there
will not be any further enforcement action, the occurrence of which may result in further liabilities, penalties and operational disruption.

In view of the above facts and circumstances,
the Company believes that it is not necessary to accrue for any estimated losses or impairment as of June 30, 2025.

NOTE 21 - SUBSEQUENT EVENT

Subsequent Event

On July 3, 2025, the Company