During the Track Record Period, revenue generated from sales of such products accounted for approximately 1.9%, 2.6%, 2.3% and 2.3% of our total revenue in 2023, 2024, 2025 and the four months ended April 30, 2026.
Business · 第 140 页
During the Track Record Period, our revenue generated from our product sales to the U.S. amounted to approximately RMB137.7 million, RMB63.2 million, RMB7.3 million and RMB1.2 million, respectively, accounting for 0.2%, 0.1%, 0.01% and less than 0.01% of the total revenue for the respective periods.
Business · 第 140 页
As advised by our International Trade Controls Legal Advisor, our AI-related research and development activities do not fall under the definition of a ‘notifiable transaction” or a “prohibited transaction” under the OISP, and we are not a “covered foreign person” under the Final Rule, as we do not engage in any “covered activity” as defined therein.
During the Track Record Period, our purchases of U.S.-origin products were relatively limited, amounted to RMB3.0 million, RMB0.1 million, RMB0.05 million and RMB0.2 million, representing only 1.2%, 0.1%, 0.05% and 0.5% of our total purchases in 2023, 2024, 2025 and the three months ended March 31, 2026, respectively.
Summary · 第 7 页
Going forward, the Company intends to continue and reinforce this practice of prioritizing non-U.S.-origin and local suppliers where commercially reasonable and functionally appropriate, which is expected to further reduce the Company’s reliance on U.S.-origin items over time.
Summary · 第 7 页
Based on the analysis by our Sanctions Counsels mentioned above, our Directors are of the view, and the Sole Sponsor concurs, that we do not expect that the U.S. tariffs, export controls or sanctions measures will have a material adverse impact on our Company’s business operations or financial performance.
Among the Procured Items, we have procured US-origin items at an amount of RMB11.4 million, RMB123.8 million, RMB255.7 million and RMB129.5 million in 2023, 2024, 2025 and four months ended April 30, 2026, respectively, representing 0.1%, 0.75%, 1.15% and 0.8% of our total procurement for the same period.
Summary · 第 24 页
During the Track Record Period and up to the Latest Practicable Date, we did not sell any items that are subject to the EAR to entities on the Entity List and the Military End-User List (“BIS Entities”) or to any entities on the SDN List.
Summary · 第 24 页
Our Directors believe that, taking into account the aforementioned view of our International Sanctions Legal Advisor, we are in compliance with applicable U.S. export control laws and the risk is low that our global supply of these Procured Items will be subject to material adverse disruption because of U.S. export control reasons.
Nevertheless, certain chips we procured through non-U.S. suppliers for our NAS products are of U.S. origin and are subject to the U.S. Export Administration Regulations (“EAR”).
Business · 第 187 页
The procurement amounts of such chips were approximately RMB19.7 million, RMB45.0 million, and RMB151.1 million, and RMB64.5 million in 2023, 2024, 2025, and for the six months ended June 30, 2026, respectively, accounting for 0.7%, 1.2%, 2.5%, and 1.8% of our cost of sales for the corresponding year/period.
Business · 第 187 页
Our Directors are of the view that, based on our current assessment and market inquiry, functionally equivalent chips from non-U.S. suppliers or from alternative production origins are available in the market and, in the event that these U.S.-origin chips become subject to adverse U.S. export control policies or sanctions, we would be able to substitute such chips without material technical modifications to our products, material disruptions to our production, or any material adverse impact on our business operations or financial performance.
For the years ended December 31, 2023, 2024, 2025 and the six months ended June 30, 2026, our aggregate purchase amounts from the Entity List Foundries were RMB24.4 million, RMB128.2 million, RMB292.0 million and RMB165.8 million, respectively, representing 4.6%, 23.2%, 42.4% and 39.9% of our total revenue for the corresponding years/periods, respectively.
Business · 第 174 页
To manage potential regulatory and supply-chain risks and ensure adherence to applicable export control and sanctions requirements, we have established a risk-based compliance program consisting of various internal control measures.
Business · 第 175 页
Based on the above facts, on the basis that we have not sold products to Entity List designees and subject to our ongoing implementation of the export controls compliance measures, our legal adviser as to U.S. outbound investment rules, sanctions and export control laws has informed us that our procurement of mask generation and wafer foundry services from the Entity List Foundries and furnishing chip design files to such foundries during the Track Record Period did not implicate material risks in relation to applicable U.S. export control regulations.
During the Track Record Period, certain of our Relevant Resources, including voltage converters, transceivers, switches, wireless microcontrollers and design software for printed circuit boards, are subject to the EAR, which means that the export, re-export and transfer of such Relevant Resources shall comply with the EAR.
Business · 第 162 页
As advised by our International Sanction Adviser, all of the Relevant Resources subject to the EAR procured by us can be exported by our suppliers to us without a U.S. export license based on the ECCNs of such items and the corresponding destination-based controls.
Business · 第 162 页
While these Relevant Resources subject to the EAR are important components incorporated into our products and software used to design our products, these items could generally be replaced from alternative sources in other jurisdictions around the world, at comparable quality and price.
We have procured an EDA software during the Track Record Period for chipset design and development at an aggregate cost of USD1.3 million.
Business · 第 178 页
As advised by DLA Piper, we can use the software without an export license, as long as we do not take action that violates the EAR.
Business · 第 178 页
As advised by DLA Piper, based on its review of our relevant compliance manuals, our screening procedures and the measures described above, and taking into account our current supply chain, business model and customer base, our trade compliance program is reasonably adequate and effective in relation to export control risks.
During the Track Record Period and up to the Latest Practicable Date, we procured and used certain U.S.-origin equipment, software and licensed intellectual property in our chip design activities, including protocol analyzers and electronic design automation software.
Business · 第 143 页
Recently, we engage in the design of a chip to be manufactured through a multi-project wafer process, which meets the definition of an "advanced-node integrated circuit" under the EAR.
Business · 第 143 页
our International Sanctions Counsel is of the view that our transactions during the Track Record Period and up to the Latest Practicable Date did not constitute violations of applicable U.S. export control laws and regulations or relevant international sanctions regimes.
During the Track Record Period, we procured certain U.S.-origin parts and components (including diodes, resistors, controllers, etc.) used by the Group that were subject to the Export Administration Regulations (“EAR”); however, such items were classified as EAR99 and were not otherwise controlled under the EAR.
Business · 第 183 页
Our Directors are of the view, after consultations with our legal advisor as to international sanctions (“International Sanctions Advisor”) and taking into account its view, that the impact of the current U.S. export control laws on our business is generally limited and manageable for the following reasons:
Business · 第 183 页
Our Directors are of the view, after consultations with our International Sanctions Advisor and taking into account its view, that the impact of the U.S. Outbound Investment Rules (“Final Rule”) is generally limited and manageable because:
北京中科闻歌科技股份有限公司Beijing Zhongke WengeAI Science and Technology Co., Ltd.01956.HK
曾采购符合ECCN 3A090参数的国产芯片
During the Track Record Period, our Group procured certain PRC ICs chips that meet the parameters for the control under ECCN 3A090 from an affiliated entity of Supplier B, one of our top five suppliers in 2023 and 2024, respectively. via a third-party distributor, totalling RMB23.6 million in 2023 and RMB6.6 million in 2024 (“Historical Procurements”).
Business · 第 200 页
We had not made any subsequent procurement of any chips meeting the ECCN 3A090 parameter specified in the Commerce Control List since the issuance of the Guidance (i.e., on or after May 13, 2025).
Business · 第 200 页
Therefore, as advised by our International Sanctions Legal Advisor, the Historical Procurements of the said chips do not appear to represent a violation of the applicable U.S. export controls.
On average, the value of a single 3A991 Chip accounts for only 0.65% of the total value of a finished product of us, which is below 25% (the de minimis value threshold), thus, as advised by our International Sanctions Legal Adviser, our product is not subject to the EAR under the de minimis rule under Supplement No. 2 of Part 734.
Business · 第 189 页
Based on Hogan Lovells' confirmation, four entities which were designated on the Entity List had transactions with us since 1 January 2022 (the "EL Parties"), and none of them of our five largest customers or suppliers for each year during the Track Record Period, respectively.
Summary · 第 16 页
Accordingly, as advised by Hogan Lovells, (1) the export restrictions associated with the EL Parties' designation on the BIS Entity List are not implicated for us; and (2) no other purchases by our Group from suppliers during the Track Record Period are exposed to restriction as a result of designation on the Entity List.
As advised by our International Sanctions Legal Adviser, Hogan Lovells, the Procured Items that are classified under EAR99 consist of low-technology consumer goods and do not require a license in most situations.
Business · 第 169 页
As advised by our International Sanctions Legal Adviser, the procurement from Supplier A did not represent a violation of the U.S. Export Controls.
During the Track Record Period, Supplier I, our third largest supplier in 2023, was a U.S. company that supplied integrated circuits to us that would be used in our photovoltaic inverters and energy storage inverters.
Business · 第 143 页
During the Track Record Period, our business involved certain overseas markets, including Iraq, Turkey, Afghanistan, Lebanon, Yemen, and Tunisia.
Business · 第 144 页
Having consulted with our independent sanctions and U.S. export controls legal advisor, our Directors are of the view that no violation of U.S. sanctions and embargo laws was identified based on the information reviewed, and the risk of such issues going forward remains low
During the Track Record Period, we procured items subject to the EAR and classified as ECCN 5D002.c, 5D992.c and EAR99 (“Procured Items”).
Business · 第 167 页
Since we are not AT Restrictions Sanctioned Targets, we do not require a license to procure these Procured Items.
Business · 第 167 页
Our Directors are therefore of the view that our Group’s business operations and financial performance are not materially adversely affected by the applicable U.S. export control restrictions.
Effective June 5, 2020, the BIS added “Intellifusion” with aliases “Shenzhen Yuntian Lifei Technology Co., Ltd.” and “Yuntian Lifei”, which are English translations of its official Chinese name, to the Entity List, and the Listed Entity was subsequently designated as a Footnote 4 entity on October 7, 2022, pursuant to Supplement No. 4 to Part 744 of the EAR.
Business · 第 171 页
Based on the information reviewed and the legal advice received, there is no factual basis to conclude that the Company or its subsidiaries violated the EAR at the time of the relevant procurements or engaged in prohibited circumvention.
Business · 第 172 页
Our Directors and the Joint Sponsors, after due inquiry and consultation with C&F, are of the view that the Entity List designation does not have a material adverse effect on our business and operations, or [REDACTED] suitability under Chapter 4.4 of the Guide.
Following the U.S. export control developments announced in Q4 2024, we transitioned subsequent projects to domestic fabrication partners, which now substantially support our ongoing and future production needs without material adverse impact on our operations or technology development.
Summary · 第 15 页
This fabrication partner agreed to release the remaining wafers to us after we obtained a Commodity Classification Automated Tracking System (CCATS) validation issued by the BIS for PACE 2 on December 12, 2025, and we have received such wafers in late December 2025.
Business · 第 173 页
the domestic fabrication partners have achieved a performance level comparable to that of Supplier F as a result of our close cooperation and technical oversight
These tools are essential to our product design and development processes, and have long been under consideration for U.S. export licensing requirements when destined for China.
Business · 第 173 页
We plan to renew multi-year agreements with EDA providers in mid-2026 to ensure continued access beyond the current license terms, and do not foresee any obstacles in obtaining such renewal.
Business · 第 173 页
To preempt such adverse impact, we actively engage with our current EDA tool suppliers to renew license agreements, and explore alternative suppliers outside the U.S. for potential service procurement and have established a rigorous export compliance system to conduct periodic assessment to ensure ongoing regulatory compliance and minimize the risk of license revocation.
To maintain our competitive edge, sustainable development and regulatory compliance, we have refined our business operations by leveraging our relationship with Amlogic Holdings Ltd., a substantial Shareholder, through our Export Control Compliance Arrangement (as defined below).
Summary · 第 14 页
Our Directors are of the view, after consultant with our International Sanctions Legal Advisor, that our Export Control Compliance Arrangement has been and remains compliant with applicable U.S. export control regulations.
Summary · 第 14 页
However, we assess the likelihood of such objection to be low for the following reasons: (i) the authorized IC designer status of Authorized IC Designer Subsidiary provides foundries with enhanced compliance certainty regarding their own export control obligations; and (ii) foundries accepted the qualification of the Authorized IC Designer Subsidiary and continued to process orders as of the Latest Practicable Date.
Certain of our AI ASIC customization services involved the use of certain U.S.-origin software tools, IP, and components, and therefore required an assessment under applicable U.S. export control laws.
Business · 第 134 页
For example, one of our founding partners is included on a U.S. export control list.
Business · 第 134 页
However, our international sanction legal advisor is of the view that our procurement of founding services and materials from it does not violate the applicable U.S. export control rules as the items involved do not fall within the jurisdictional scope of these rules.