During the Track Record Period, we had provided supply chain solutions to and imported electronics into China on behalf of four customers (“Designated Entities”), who were added by the U.S. Department of Commerce Bureau of Industry and Security (“BIS”) to the Entity List through amendments to the Export Administration Regulations (“EAR”).
Business · p. 227
Considering (i) our revenue attributable to our transactions with the Designated Entities merely amounted to approximately RMB108,312, RMB41,402 and nil collectively in FY2023, FY2024 and FY2025, respectively (ii) our core business does not depend on items subject to the EAR; and (iii) our ability to secure alternative customers for our services, our Directors are of the view, with the Sole Sponsor concurring that, our termination of the business relationship with the Designated Entities and compliance with the EAR will not have any material adverse impact on our business operation, financial positions and prospects.
Business · p. 229
During the Track Record Period, we had provided export solutions to two China-based customers and assisted them with customs clearance and transportation services for their export of Chinese-origin point-of-sale machines, repair parts, rack-mounted servers, switches and network management devices to a consignee in Zimbabwe and an entity in Russia.
During the Track Record Period, we used U.S.-origin EDA software and semiconductor IP blocks to design all our IC products, which are thus direct products of U.S. software and/or technology subject to the EAR.
Business · p. 167
We obtained BIS licenses for supplying certain EAR99 products to one entity on the BIS Entity List, and conducted a one-time supply of EAR99 products to the entity in strict compliance with such licenses during the Track Record Period.
Business · p. 167
As advised by our International Sanctions Legal Advisor, we are a “covered foreign person” under the Outbound Investment Rule, although there is no assurance that the U.S. Department of the Treasury will take the same view.
For the years ended December 31, 2022, 2023, 2024 and the nine months ended September 30, 2025, our revenue from SDN Customer was approximately RMB607,080, RMB30,973, nil and nil, accounting for approximately 0.004%, 0.0002%, nil and nil of our total revenue for the same periods, respectively.
Business · p. 157
As a result, our International Sanctions Legal Adviser confirmed that SDN Transactions and Bank Payments Transactions did not constitute U.S. primary sanctions violations.
Business · p. 157
As of the Latest Practicable Date, we had ceased the SDN Transactions and we no longer accept payments from the Designated Bank.
During the Track Record Period, our revenue derived from the U.S. was insignificant, and products sold in the U.S. were primarily manufactured in Europe rather than exported directly from Chinese Mainland.
Summary · p. 27
Our Directors are of the view that recent geopolitical developments and U.S.-China trade tensions have not had a material adverse effect on our operations or financial performance.
In 2023, 2024 and 2025, our revenue generated from the Relevant Regions amounted to approximately RMB11.56 million, RMB12.63 million and RMB19.79 million, respectively, which represented less than 5% of our total revenue during the same period.
Business · p. 180
During the Track Record Period, we recognized revenue of approximately RMB0.61 million, RMB0.95 million and RMB0.91 million in 2023, 2024 and 2025, respectively, from sales of dental products to one customer in Syria (the “Syrian Customer”).
Business · p. 180
As at the Latest Practicable Date, we have ceased all business with Myanmar.
During the Track Record Period, we have sold our products to certain China-based customers that have been designated by the BIS to the Entity List, with revenue amounting to RMB11.5 million, RMB2.6 million, RMB0.6 million and RMB0.4 million for 2022, 2023, 2024 and the nine months ended September 30, 2025, respectively.
Summary · p. 6
After the said customer’s inclusion in the Entity List and designation as an SDN, we ceased all transactions with the said customer.
Business · p. 177
our Directors are of the view that the International Sanctions and U.S. export control rules do not have a material adverse impact on our business operations and financial performance
Our transactions with the customers on the Entity List had no material impact on our results of operations or financial positions during the Track Record Period and up to the Latest Practicable Date.
Summary · p. 18
We have no ongoing business with the Entity List Designees as of the Latest Practicable Date.
Summary · p. 18
Hence, our products are not subject to the U.S. export restrictions, and our past or current transactions with the customers on the Entity List will not trigger U.S. or other regional sanctions issues.
Our international sanctions counsel is of the view that, we are a covered foreign person because the solutions that we develop and offer can be used for public service analysis by our customers and fall within the category of notifiable transactions under the Final Rule.
Summary · p. 18
After consultation with our International Sanctions Advisors, our Directors are of the view, and the Joint Sponsors concur that, the Final Rule will have limited impact on the Group's business operations and financial performance, as well as the Global Offering because (1) investments by persons other than U.S. persons as defined under the Final Rule are not subject to the Final Rule, and (2) U.S. persons are not prohibited from but shall bear the obligation to notify the U.S. Department of Treasury after acquiring any of our equity interests that are not yet publicly traded, including the Global Offering, except through valid exceptions or unless such investments were completed prior to the effective date of the Final Rule.
During the Track Record Period, we have sold our ODM products to a customer listed on the Entity List ("Entity List Customer"), which is identified as Customer E in "— Sales and Marketing — Customers" section above, and generated revenue of RMB2,166.8 million, RMB1,780.1 million, RMB2,609.7 million and RMB1,838.0 million in 2022, 2023, 2024, and the nine months ended September 30, 2025.
Business · p. 263
As advised by our International Sanctions Legal Advisors, given the aforementioned nature of our transactions with such Entity List Customer, these transactions did not involve any exports or transactions of any items subject to the EAR, and hence did not represent a violation of the International Sanctions.
Business · p. 263
We have undertaken to the Stock Exchange that we will not use the proceeds from the Global Offering, as well as any other funds raised through the Stock Exchange, to finance or facilitate, directly or indirectly, activities or business with, or for the benefit of, any Comprehensively Sanctioned Countries^1^ or any other government, individual or entity sanctioned by the U.S., the EU, the UN, the U.K., the United Kingdom overseas territories or Australia, including, without limitation, any government, individual or entity that is specifically identified on the SDN List maintained by OFAC or other restricted parties lists maintained by the U.S., the EU, the UN, the U.K., the United Kingdom overseas territories and Australia that would cause us to violate International Sanctions.
In 2022, 2023, 2024, and in the six months ended June 30, 2025, we had 5, 4, 8 and 7 customers, respectively, and 2, 1, 4 and 3 suppliers, respectively, that were included on the Entity List and/or designated by OFAC on the Non-Specially Designated Nationals (SDN) Chinese Military-Industrial Complex Companies List (the “NS CMIC List”), during these respective periods.
Summary · p. 15
On the basis of this due diligence and legal analysis, the Export Control Legal Advisor is of the view that, during the Track Record Period and up to the Latest Practicable Date, the Group has not violated the EAR in any material respect.
Summary · p. 16
The Group had transactions with entities on the NS CMIC List during the Track Record Period and expects to continue to transact with certain of these entities.
As advised by DLA Piper, our Directors believe that we are likely to be deemed a Covered Foreign Person engaged in one of the “covered activities” (including (i) semiconductors and microelectronics, (ii) quantum information technologies, and (iii) artificial intelligence systems) as we design integrated circuits as described in the definition of “notifiable transactions” in 31 C.F.R. §850.217.
Business · p. 238
The procurement amounts of such items and EAR-99 Items were RMB107.9 million, RMB38.8 million and RMB76.5 million in 2022, 2023 and 2024, respectively, accounting for 1.93%, 0.89% and 1.45% of the total procurement amount of the Company during the respective years.
Business · p. 239
Based on the above, and that, as advised by DLA Piper, it is the responsibility of the U.S. person engaged in a “notifiable transaction” to make a notification to Treasury pursuant to the Final Rule, our Directors do not believe that the Final Rule is expected to have a material adverse impact on our business, results of operations, financial condition or the Global Offering.
Since our principal place of business is in China and we engage in the development of certain AI models, we are likely to be deemed as a "covered foreign person" as described in the Final Rule.
Summary · p. 31
Accordingly, it appears likely that some U.S. persons that purchase our Shares in the Global Offering or are the parents of non-U.S. person subsidiaries that purchase our Shares in the Global Offering would be required to file notifications regarding their or their subsidiaries’ purchases with Treasury no later than 30 days after such purchases of the Shares.
Business · p. 342
As advised by our international sanctions legal advisor, our Directors are of the view that the Final Rule will not have a material effect on our business, results of operations or financial condition, in part because: (i) in light of the totality of the circumstances of the Global Offering, including that it is expected to be marketed to, and capable of being supported by, a broad investor base (including non-U.S. investors), the Final Rule is not expected to materially constrain investor participation in the Global Offering;
During the Track Record Period, Jinxun DR Congo sold certain copper cathode to our Singapore subsidiary internally.
Business · p. 231
These transactions involving DR Congo did not involve any exports or transactions of any items subject to the Export Administration Regulations nor relate to any sanctioned entities.
Business · p. 231
therefore, our business operations involving DR Congo during the Track Record Period did not represent a violation of the International Sanctions, a Primary Sanctioned Activity or a Secondary Sanctionable Activity.
For example, the U.S. Department of Commerce issued an ‘‘Is Informed’’ letter to Supplier F in November 2024, imposing immediate export restrictions to prevent Supplier F’s shipment of certain types of advanced semiconductor products to China, particularly those used in AI applications.
Business · p. 220
As a result of the foregoing, we experienced a temporary disruption in supply of certain types of co-packaged integrated circuits used for several of our products from late November 2024 to early February 2025.
Business · p. 220
This temporary supply interruption did not materially affect our operations primarily because we had proactively built up and maintained sufficient inventory levels to fulfill customer commitments; the timing of the disruption coincided with typical seasonal industry slowdowns in customer demand; and importantly, we had already initiated and made substantial progress in implementing alternative supply arrangements as part of our routine supply chain risk management strategy.
On January 16, 2025, our Company and nine of our subsidiaries were added to the Entity List administered by the BIS.
Summary · p. 22
During the Track Record Period and prior to the Entity List Addition, we purchased certain computing hardware containing U.S.-origin AI chips subject to the EAR in compliance with the relevant export control rules and regulations and we have not procured any items subject to the EAR since August 2023.
Business · p. 214
In light of the above, the Entity List Addition has not had, and our Directors are of the view that (assuming there is no expansion of the EAR restrictions or the scope of the Entity List Addition) it will not have in the near future, any material adverse impact on our business and financial performance.
Effective October 17, 2023, the BIS added certain entities of our Group to the Entity List, specifically Beijing Biren Technology Development Co., Ltd.; Guangzhou Biren Intelligent Technology Co., Ltd.; Hangzhou Biren Technology Development Co., Ltd.; Shanghai Biren Information Technology Co., Ltd.; Guangzhou Biren Semiconductor Technology Co., Ltd.; Shanghai Biren Technology Co., Ltd.; Shanghai Xinzhili Enterprise Development Co., Ltd.; and Zhuhai Biren Integrated Circuit Co., Ltd. (collectively, the "Listed Entities").
Summary · p. 24
As advised by JBK, neither the BIS Listing nor the Affiliates Rule should have a material impact on the business or operations of our Group.
Summary · p. 25
For items procured by the Listed Entities that it believes may be subject to the EAR, we have identified and entered into agreements with domestic alternative suppliers, or developed in-house alternatives for items required for the development and production of our solutions and previously sourced by the Listed Entities which are or may be subject to the EAR.
We utilize certain semiconductor chips in our products, among which over 97% of the semiconductor chips concerned are non-U.S.-branded semiconductors sourced from non-restricted suppliers.
Business · p. 309
During the Track Record Period, we made only immaterial purchases (representing less than 0.1% of purchase amount for each year/period) of chips that were originally manufactured by BIS Lists suppliers.
Business · p. 310
Accordingly, our Directors are of the view that existing U.S. export controls and sanctions have not had, and are not expected to have, any material adverse effect on our business operations or financial performance, and that the risk of future restrictions materially affecting our business is low.
Certain of our customers and shareholders are listed on the Entity List: (i) Entity 1 as our customer, (ii) Entity 2 as a shareholder of our Company and (iii) Entity 3 as a shareholder of our Company and a customer (collectively referred to as the "Relevant Entities").
Business · p. 250
revenue attributable to Entity 3 amounted to approximately nil, RMB40.5 million, nil and nil in 2022, 2023, 2024 and the six months ended June 30, 2025, respectively, accounting for approximately nil, 15.8%, nil and nil of our total revenue for the same periods.
Business · p. 251
Based on the foregoing, our Directors are of the view, and the Joint Sponsors concur, that there are no material imminent risks or historical impact relating to EAR with respect to our products and solutions that would have a material impact on our business, results of operations, and financial condition.
In 2022, 2023, 2024 and the six months ended June 30, 2025, we had 13, 15, 15 and 15 customers, respectively, that were included on the U.S. Department of Commerce’s Entity List or Unverified List, and revenue generated from such customers in aggregate accounted for approximately 3.7%, 6.0%, 6.6% and 6.6% of our total revenue for the same periods.
Business · p. 196
As advised by our legal advisors as to U.S. export controls, tariff and outbound investment, our current services and products are not subject to the scope of the EAR.
Business · p. 196
Therefore, as advised by our legal advisors as to U.S. export controls, tariff and outbound investment, we believe that tariff policies have not had a material impact on our business operations, financial condition, or results of operations.
On October 28, 2024, the U.S. Department of the Treasury (the “Department of Treasury”) issued the “Provisions Pertaining to U.S. Investments in Certain National Security Technologies and Products in Countries of Concern” (the “Final Rule”) to implement an outbound investment program that restricts investments by U.S. persons and U.S.-controlled entities.
Summary · p. 26
Following consultations with our legal advisor regarding U.S. foreign investment laws and taking into account of their view, our Directors believe that the Final Rule has no material adverse impact to our business operations, financial performance and the Global Offering because (i) although investments by U.S. persons in us likely constitute “notifiable transactions” under the Final Rule, they do not constitute “prohibited transactions” under the Final Rule, as our business involving the design of ICs do not meet the standard of the design of advanced ICs under the “prohibited transaction” criteria;
Summary · p. 26
Should the purchase of our H Shares in the Global Offering by U.S. persons be considered notifiable transactions, the obligation to report such notifiable transactions to the U.S. Department of the Treasury lies with the U.S. persons making such investments, and there is no reporting obligation imposed on us under the Final Rule;