Company: GDHLF
Filing Date: 2025-05-29
Form Type: 424B5
Source: 0001104659-25-053917
Chunk: 57

Company: GDS Holdings Ltd
Filing Date: 2025-05-29
Form: 424B5
Chunk 57
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 we do not expect to be a PFIC for our current taxable year or in the foreseeable future, although there can be no assurance in this regard. The determination of whether or not we are a PFIC is made on an annual basis and will depend on the composition of our income and assets from time to time. Specifically, for any taxable year, we will be classified as a PFIC for U.S. federal income tax purposes if either (i) 75% or more of our gross income in that taxable year is passive income or (ii) the average percentage of our assets (which includes cash) by value in that taxable year which produce, or are held for the production of, passive income is at least 50%. The calculation of the value of our assets will be based, in part, on the quarterly market value of our ADSs, which is subject to change. See “Taxation — U.S. Federal Income Tax Considerations — Passive Foreign Investment Company Considerations.”

In addition, there is uncertainty as to the treatment of our corporate structure and ownership of the VIEs for U.S. federal income tax purposes. For U.S. federal income tax purposes, we consider ourselves to own the stock of the VIEs. If it is determined, contrary to our view, that we do not own the stock of the VIEs for U.S. federal income tax purposes (for instance, because the relevant PRC authorities do not respect these arrangements), we may be treated as a PFIC.

If you are a U.S. holder, as defined under “Taxation — U.S. Federal Income Tax Considerations,” and we are a PFIC for any taxable year during which you hold our ADSs or Class A ordinary shares, our PFIC status could result in adverse U.S. federal income tax consequences to you. For example, if we are or become a PFIC, you may become subject to increased tax liabilities under U.S. federal income tax laws and regulations and may become subject to burdensome reporting requirements. In some cases, shareholders of a PFIC may make one of certain elections that would ameliorate some of the adverse tax consequences of the PFIC rules. See “Taxation — U.S. Federal Income Tax Considerations — Passive Foreign Investment Company Considerations” for further details. You are urged to consult your own tax advisors concerning the U.S. federal income tax consequences of the application of the PFIC rules.

There can be no assurance that we will not be a PFIC for the