IPO News | Taihe Music Proposes Hong Kong Stock IPO, China Securities Regulatory Commission Requests Additional Explanations on Offshore Structures and Compliance for Return Investments

The Zhitong Finance App learned that on September 11, the China Securities Regulatory Commission issued the “Requirements for Supplementary Materials for Overseas Issuance and Listing Filing (September 7, 2026 to September 11, 2026)”. The International Division of the China Securities Regulatory Commission issued supplementary material requirements for a total of 9 companies. Among them, Taihe Music was requested to provide additional explanations on matters such as the construction of offshore structures and compliance with return investments. According to the Hong Kong Stock Exchange's disclosure on June 22, Taihe Music Group (Taihe Music for short) submitted a statement to the main board of the Hong Kong Stock Exchange, with Deutsche Bank and CITIC Construction Investment International as co-sponsors.

The China Securities Regulatory Commission requested Taihe Music to further explain the following matters, and ask lawyers to check and issue clear legal opinions:

1. Regarding domestic operating entities: (1) Please explain the issuer's registered capital payment status, the basis for each capital increase and share transfer pricing (prices are listed separately), whether the investment was actually paid, whether there were situations of failure to fulfill funding obligations, evasion of capital, and defects in funding methods, and issue a clear concluding opinion on whether the successive equity changes are legal and compliant; (2) Please explain whether the domestic operating entity's business scope and actual business involves areas where foreign investment is restricted or prohibited and the basis for relevant judgments after this issuance. Admission policy requirements.

2. Regarding the shareholder situation: (1) Please explain whether there are any cases of proxy shareholding in the history of issuers and domestic operating entities; (2) Please conduct a thorough inspection of upper level overseas entities holding 5% or more of the shares in accordance with the “Guidelines for the Application of Regulatory Rules - Overseas Issuance and Listing Class No. 2” to explain whether there are entities prohibited from holding shares by laws and regulations.

3. Regarding the compliance of offshore structures and return investments, please explain: (1) The issuer and domestic shareholders have implemented the specific regulatory procedures for foreign exchange management, overseas investment, foreign investment, tax administration, etc. involved in the establishment of offshore structures and return investments, and issue concluding opinions on whether they comply with the regulations in force at the time. (2) Whether the issuer obtains transaction consideration, pricing basis, payment method, payment period, fairness of pricing from domestic operating entities, and the transferor's compliance with tax reporting obligations relating to the above equity transfer process complies with the “Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors”.

4. Regarding the equity incentive plan: (1) Please issue a clear conclusion on whether the implementation of the equity incentive plan is legal and compliant and whether there is a transfer of benefits; (2) Please explain the fair price of the equity incentive plan, whether the incentive target still holds the relevant incentive share after leaving the job, whether there are any disputes or potential disputes; (3) the equity incentive plan charter or agreement, the specific personnel composition, employment situation and benefit share, the reasons why the equity incentive structure is used, and the main content of the trust-related contract, including but not limited to the specific methods and methods of trust-related trusts Toru Management authority, trust or asset management fees, contract period and termination conditions, trust asset handling arrangements, contract signing time, and other special terms; (4) Please explain the basic situation of trusts and domestic entities mentioned above in accordance with the requirements of the “Guidelines for the Application of Regulatory Rules - Overseas Issuance and Listing Class No. 2”.

5. Please explain the details of how Chengdu Taihe has received administrative penalties and rectification from the Chengdu Municipal Administration of Culture, Radio, Television, and Tourism on several occasions, whether it has had a significant adverse impact on this listing, and whether it constitutes a major violation of law and regulations. Please check at the same time whether the issuer's other domestic operating entities may have experienced similar situations.

6. In accordance with the requirements of the “Guidelines for the Application of Regulatory Rules - Overseas Issuance and Listing Class No. 2”, please explain the nationality and other permanent overseas residency rights of the issuer's directors, senior management, and beneficiaries after penetration.

7. Please explain whether this listing in Hong Kong is a situation where the NASDAQ and Hong Kong Stock Exchange listed companies split their subsidiaries and are listed independently in other overseas markets. (1) If it is a spin-off of a listed company, explain the rationality, necessity, and feasibility of the spin-off; (2) whether the listed company and the subsidiary to be split are independent of each other in terms of assets, finance, and personnel, whether the listed company can maintain independence and sustainable management capacity after the spin-off, and whether the new company formed from the spin-off has corresponding standardized operation capabilities.

According to the prospectus, according to Frost & Sullivan data, according to 2025 revenue, the company is a leader in the global independent Chinese-language music content and service industry. It is also a pioneer in the ecological integration of the entire music industry chain, and is committed to providing comprehensive one-stop music content and services for music creators and industry participants.