(ii) the Group had complied with the arm’s length principle as stipulated in applicable transfer pricing laws and regulations in the relevant jurisdictions during the Track Record Period and up to the Latest Practicable Date, and (iii) the risk of additional enterprise income tax liabilities arising from our transfer pricing adjustments was relatively low.
We believe the above-mentioned intra-group transactions were in line with the arm’s length principle and we were in compliance with the relevant transfer pricing laws and regulations during the Track Record Period and up to the Latest Practicable Date.
We could face material and adverse tax consequences if the relevant tax authorities determine that the certain intra-group transactions of ours are not conducted on an arm’s length basis and consequently adjust any of those entities’ income in the form of a transfer pricing adjustment.
Risk Factors · p. 40
The estimated potential tax exposure after taking into account the effect of the double taxation agreements in respect to the Covered Transactions represented less than 0.5% of our profit before income tax in any given period during the Track Record period.
Business · p. 154
Based on the foregoing, our Directors and Transfer Pricing Consultant are of the view that (i) our Group’s transfer pricing arrangements for the Covered Transactions conducted during the Track Record Period complied with the OECD Transfer Pricing Guidelines in material respects and, where applicable, local transfer pricing regulations in relevant jurisdictions, and (ii) the risk for our Group to conduct material transfer pricing adjustment is relatively low.
Accordingly, based on the transfer pricing review conducted by the Tax Advisor, the Tax Advisor confirmed that our Group complied with the applicable transfer pricing regulations in the relevant jurisdictions during the Track Record Period and up to the Latest Practicable Date.
Business · p. 183
During the Track Record Period and up to the Latest Practicable Date, our transfer pricing arrangements had not been subject to any challenge or investigation by any relevant tax authorities.
our Directors are of the view that (1) our transfer pricing arrangements during the Track Record Period were reasonable and consistent with the arm’s length principle in all material respects; (2) such arrangements should not give rise to any material transfer pricing exposure; and (3) the risk of any material transfer pricing adjustment in respect of our major intra-group transactions is low.
Business · p. 146
During the Track Record Period and up to the Latest Practicable Date, we had not been subject to any material investigation, adjustment or penalty imposed by the relevant tax authorities in connection with our transfer pricing arrangements.
After assessing our transfer pricing arrangements during the Track Record Period, and as advised by our Transfer Pricing Adviser, these transfer pricing arrangements were, in all material respects, broadly consistent with the arm’s length principle under both the OECD Transfer Pricing Guidelines and the relevant local transfer pricing laws and regulations in the applicable jurisdictions, and thus no quantified exposure to transfer pricing adjustment or additional taxes had been identified.
In December 2024, the relevant tax authority imposed an administrative fine of RMB0.8 million on us.
Business · p. 169
The fine primarily related to (i) underpayment of enterprise income tax of approximately RMB1.0 million, as certain expenses included in our R&D expenses for 2023 were subsequently determined not to be related to R&D activities; and (ii) our failure to withhold individual income tax of approximately RMB0.4 million in aggregate in 2021 and 2023.
Our PRC Legal Advisor is of the view that, based on the foregoing, the Group did not have any non-compliance in relation to the Two-Invoice System during the Track Record Period and up to the Latest Practicable Date, and there was no material adverse impact on the Group’s operations or financial position.
Based on the foregoing, the transfer pricing consultant has concluded that our transfer pricing policy generally falls within an arm’s length range in terms of the intra-group transactions.
Business · p. 169
As advised by the transfer pricing consultant and upon reviewing the corresponding reports, our Directors and our transfer pricing consultant are of the view that the above-mentioned intra-group transactions of our Group were in line with the arm’s length principle and that our Group had been in compliance with the relevant transfer pricing laws and regulations in all material respects during the Track Record Period and up to the Latest Practicable Date.
Business · p. 169
Our Directors and our transfer pricing consultant are further of the view that the risk of our transfer pricing arrangements during the Track Record Period being challenged by the relevant tax authorities for profit shifting is relatively low.
During the Track Record Period and up to the Latest Practicable Date, we conducted certain intragroup transactions among our Company and our subsidiaries in the ordinary course of business to facilitate the respective functions of our Group entities.
Business · p. 154
Based on such reviews, we believe that our transfer pricing arrangements during the Track Record Period were consistent with the arm’s length principle.
The Tax Advisor is of the view that the risk of potential transfer pricing adjustments is low.
Business · p. 164
our Directors are of the view that the intra-group transactions described above were conducted on an arm’s length basis and that we complied with the relevant transfer pricing laws and regulations during the Track Record Period.
Our Directors confirm that (i) our transfer pricing arrangements during the Track Record Period were conducted on an arm’s length basis and in compliance with all applicable transfer pricing laws and regulations in all material respects; (ii) there is no need for any transfer pricing adjustment or provision within our Group; and (iii) our transfer pricing arrangements have not been challenged or investigated by any relevant tax authority during the Track Record Period and up to the Latest Practicable Date.
After assessing our transfer pricing arrangements during the Track Record Period, our Directors are of the view, based on the advice provided by our Transfer Pricing Adviser that the intra-group transactions were, in all material respects, consistent with the arm's length principle under both the OECD Transfer Pricing Guidelines and the relevant local transfer pricing laws and regulations in the applicable jurisdictions.
Business · p. 178
During the Track Record Period and up to the Latest Practicable Date, we had not been made aware of any inquiries, audits, investigations, or challenges by the relevant tax authorities in the jurisdictions in which we operate with respect to our intra-group transactions.
Based on the Transfer Pricing Consultant’s review and economic analysis, Transfer Pricing Consultant is of the view that, during the Track Record Period, all the transfer pricing arrangements for the Covered Transactions are in line with arm’s length principle according to the OECD Transfer Pricing Guidelines.
Business · p. 207
Our Directors confirm that during the Track Record Period and up to the Latest Practicable Date, we were not aware of any outstanding enquiries, audit, investigation or challenge by any tax authorities in relation to the Covered Transactions.
Our Independent Transfer Pricing Consultant concluded that the transfer pricing policy in 2023, 2024, 2025 and the five months ended May 31, 2026 generally conforms to arm’s length principle or does not give rise to material transfer pricing tax risks.
Upon consultation with the transfer pricing consultant, our Directors are of the view that our major intra-group transactions during the Track Record Period were conducted in accordance with the arm’s length principle in material respects.
We believe that the pricing of such transactions was consistent with the arm’s length principle and, to the best of our knowledge, there were no transfer pricing adjustments imposed that would give rise to additional tax liabilities under the applicable transfer pricing laws and regulations.
Based on the above analysis, our Transfer Pricing Advisor is of the view that our intra-group transactions generally complied with the arm’s length principle.
Business · p. 180
Accordingly, no transfer pricing adjustments giving rise to additional tax liabilities were identified.
Business · p. 180
In addition, our Group has complied with its obligation of related-party filings and/or Transfer Pricing documentation (local file) according to the transfer pricing regulations of relevant jurisdictions in which it operates during the Track Record Period and up to the Latest Practicable Date.
We have implemented internal procedures and controls to ensure ongoing compliance with such requirements and are currently in compliance in all material respects with the applicable seller information reporting requirements in these key jurisdictions.