IPO News | Huafuyang plans to list Hong Kong stocks, China Securities Regulatory Commission requires clarification on matters such as compliance with cross-border funding arrangements

Zhitong Finance App learned that on August 15, the China Securities Regulatory Commission announced the “Requirements for Supplementary Materials for Overseas Issuance and Listing Filing (August 8, 2025 to August 14, 2025)”. The China Securities Regulatory Commission issued supplementary material requirements for 7 companies including Huafuyang. Among them, the Securities Regulatory Commission requested Hua Fuyang to explain matters such as the compliance of cross-border funding arrangements and the type, scale, source, and usage of data information collected and stored during the business development of domestic operating entities. According to reports, Hope Sea Inc. (Huafuyang) submitted a listing application to the main board of the Hong Kong Stock Exchange on June 16, 2025, with Agricultural Bank International as the sole sponsor.

The Securities Regulatory Commission requested Huafuyang to provide additional explanations on the following matters, and requested lawyers to check and issue clear legal opinions:

1. From May to June 2025, the company obtained 100% of the rights of domestic operating entities through capital increases to purchase shares in Zhongan Trading, an overseas shareholder of Shenzhen Huafuyang, and the original shareholders of China An Trade withdrew from capital reduction. Please explain the pricing basis, fairness, consideration (or capital increase) payment and income tax situation of the above capital increases and capital reductions, and whether they comply with the “Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors”, as well as the concluding observations on the legal compliance of regulatory procedures such as foreign investment and tax administration, and explain the concluding observations that all major domestic operating entities have lawfully complied with all changes in equity. Furthermore, the existing filing materials misunderstood whether the “Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors” were applied to the above capital reduction and capital increase process, so please correct them.

2. Compliance with cross-border funding arrangements. The company provides customers with cross-border funding arrangement services, including currency exchange services, structured trade settlement services, etc. Please explain the specific model of the above cross-border funding arrangement service, the pricing basis for charging customers, and the specific composition of the net income from cross-border funding arrangements, and explain whether the above cross-border capital activities are current accounts or capital projects and the basis for determining them, whether corresponding foreign exchange business qualifications are required, and whether they comply with foreign exchange management regulations.

3. Please refer to the “Guidelines for the Application of Regulatory Rules - Overseas Issuance and Listing Class No. 2” to explain the basic information of the company's shareholders after penetrating upward.

4. Please explain the type, scale, source, and usage of data information collected and stored by domestic operating entities during business development, and whether it involves providing personal user information to third parties or overseas, and arrangements or measures for personal information protection and data security before and after listing.

5. Request the company to explain the specific reasons why the subsidy should be returned to the local government and whether the latest developments in related lawsuits constitute a substantial obstacle to the current overseas issuance and listing.

According to reports, Hope Sea was registered and established in the Cayman Islands on April 22, 2025, behind it is Shenzhen Huafuyang Supply Chain Co., Ltd., the largest electronics import supply chain solution provider in China. Huafuyang has more than 20 years of experience in the cross-border supply service industry. It mainly provides cross-border supply chain solutions for electronic products, especially integrated circuits. The services cover more than 40 vertical industries such as IoT communications, semiconductors, intelligent robots, and new energy. During the record period, Huafuyang mainly focused on importing electronic products from the customer's international upstream suppliers to China. In 2024, GMV imports reached approximately RMB 34.8 billion.