Company: DSWL
Filing Date: 2025-04-21
Form Type: CORRESP
Source: 0001174947-25-000600
Chunk: 4

Company: DESWELL INDUSTRIES INC
Filing Date: 2025-04-21
Form: CORRESP
Chunk 4
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 regulations.

We conduct our
business primarily through our PRC subsidiaries in China. Our operations in China are governed by PRC laws and regulations. As of the
date of this annual report, our PRC subsidiaries have obtained the required licenses and permits from the PRC government authorities that
are material for the business operations in China, including business certificates, plants safety certificates and pollutant discharge
permits. Given the uncertainties of interpretation and implementation of relevant laws and regulations and the enforcement practice by
relevant government authorities, we may be required to obtain additional licenses, permits, filings or approvals for our operations in
China in the future. We may be adversely affected by the complexity, uncertainties and changes in PRC regulations.

On the other
hand, under current PRC laws, regulations and regulatory rules, as of the date of this annual report, Deswell and our PRC subsidiaries
(i) are not required to obtain permissions from the CSRC, (ii) are not
required to go through cybersecurity review by the CAC, and (iii) have not
been asked to obtain or were denied such permissions by any PRC authority.

April 21, 2025
Page 9

However, the PRC government has recently indicated an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers with the passage of the Overseas Listing Trial Measures. The approval of and filing with the CSRC or other PRC government authorities may be required in connection with our offshore offerings under PRC law, and, if required, we cannot predict whether or for how long we will be able to obtain such approval or complete such filing. If we (i) do not receive or maintain such permissions or approvals or timely make such filings, (ii) inadvertently conclude that such permissions, approvals or filings are not required, or (iii) applicable laws, regulations, or interpretations change and we are required to obtain such permissions or approvals or make such filings in the future, then we may be subject to monetary fines and increased regulatory scrutiny, any follow-on offerings we conduct may be unexpectedly delayed and we may be able to continue to offer our securities to investors, all of which could have a materially adverse effect on our operations and the value of our securities.” Cash Flows through Our Organization, page 5

| 6. | We note your disclosure of the dividends Deswell paid to its investors. In your future filings, please                                      
 discuss the tax consequences of those dividends paid to investors.