What changed in this filing

/stocks — the workspaceLOADING

Item 1A. Risk Factors

2023-11-13 compared with 2022-11-02 · 624 added, 948 removed, 317 unchanged (83% of the section changed)

An investment in our common stock involves a

high degree of risk.

You should carefully consider the summary of risk factors described below, together with all of the other information

included in this report, before making an investment decision.

If any of the following risks actually occur, our business, financial

condition or results of operations could suffer.

In that case, the trading price of our common stock could decline, and you may lose

all or part of your investment.

You also should read the section entitled “Special Note Regarding Forward Looking Statements”

above for a discussion of what types of statements are forward-looking statements, as well as the significance of such statements in

the context of this report.

The risk factors below do not address all the risks relating to securities, business and operations, and

financial condition.

An investment in our ordinary

shares involves a high degree of risk.

You should carefully consider the summary of risk factors described below, together with all of

the other information included in this report, before making an investment decision.

If any of the following risks actually occur, our

business, financial condition or results of operations could suffer.

In that case, the trading price of our ordinary shares could decline,

and you may lose all or part of your investment.

You also should read the section entitled “Special Note Regarding Forward Looking

Statements” above for a discussion of what types of statements are forward-looking statements, as well as the significance of such

statements in the context of this report.

The risk factors below do not address all the risks relating to securities, business and operations,

and financial condition.

Risks Relating to our Business

14 unchanged sentences

structure, assessing and implementing our marketing program, implementing financial systems and controls and personnel recruitment.

you should consider our prospects in light of the costs, uncertainties, delays, and difficulties frequently encountered by companies

with a limited operating history.

you should consider our prospects in light of the costs, uncertainties, delays, and difficulties frequently encountered by companies with

a limited operating history.

These risks and challenges are, among other things:

we operate in an industry

that is or may in the future be subject to increasing regulation by various governmental agencies in China;

we may require additional

capital to develop and expand our operations which may not be available to us when we require it;

our marketing and growth

strategy may not be successful;

our business may be subject

to significant fluctuations in operating results;

we may not be able to attract,

retain and motivate qualified professionals.

we operate in an industry that is or may in the future be subject to increasing regulation by various governmental agencies in China;

we may require additional capital to develop and expand our operations which may not be available to us when we require it;

our marketing and growth strategy may not be successful;

our business may be subject to significant fluctuations in operating results;

we may not be able to attract, retain and motivate qualified professionals.

Our future growth will depend substantially on

our ability to address these and the other risks described in this annual report.

If we do not successfully address these risks, our

business would be significantly harmed.

If we do not successfully address these risks, our business

would be significantly harmed.

We have incurred net losses for the year

ended July 31, 2023 and expect losses to continue in the near future.

For the fiscal year ended July 31, 2022, we incurred

a loss of $2,909,584.

Our operations have been adversely affected by the effect of Covid 19.

In addition, the PRC has recently issued

statements that may have the effect of slowing down our business consulting services of assisting PRC companies to go public in the United

As a result, until the PRC further clarifies its views and regulations regarding PRC companies seeking to go public in the United

States, and PRC companies are comfortable with the business climate and seeking our services, we anticipate that we continue to experience

losses in the future.

We need additional capital.

As at July 31, 2022, we had cash of $1,750,137.

We will continue to incur costs to fund our operations and will need to raise capital for working capital until our revenues increase.

As a result, we will be required to raise capital for our operations primarily through equity offerings which may dilute existing shareholders.

No assurance can be given that we will be able to raise capital through equity offerings which could have a substantial dilutive effect

to existing shareholders.

the fiscal year ended July 31, 2023, we incurred a loss of $2.9 million.

operations have been adversely affected by the effect of Covid 19.

In addition, the PRC has recently issued statements that may have the

effect of slowing down our business consulting services of assisting PRC companies to go public in the United States.

As a result, until

the PRC further clarifies its views and regulations regarding PRC companies seeking to go public in the United States, and PRC companies

are comfortable with the business climate and seeking our services, we anticipate that we continue to experience losses in the future.

Raising additional capital may cause dilution

to our existing stockholders

As of July 31, 2023, we had cash of $0.6 million.

We may seek additional capital through a combination of private and public equity offerings, debt financings, strategic partnerships and

alliances and licensing arrangements.

To the extent that we raise additional capital through the sale of equity or convertible debt securities,

existing ownership interests will be diluted and the terms of such financings may include liquidation or other preferences that adversely

affect the rights of existing stockholders.

Debt financings may be coupled with an equity component, such as warrants to purchase shares,

which could also result in dilution of our existing stockholders’ ownership.

The incurrence of indebtedness would result in increased

fixed payment obligations and could also result in certain restrictive covenants, such as limitations on our ability to incur additional

debt, limitations on our ability to acquire or license intellectual property rights and other operating restrictions that could adversely

impact our ability to conduct our business and may result in liens being placed on our assets and intellectual property.

If we were to

default on such indebtedness, we could lose such assets and intellectual property.

If we do not continue to satisfy the Nasdaq

13 unchanged sentences

are now in compliance with the Nasdaq Listing Rules.

On July 26, 2021, we received another notice

from Nasdaq indicating we that were not in compliance with the minimum bid price requirement of $1.00 per share under the Nasdaq Listing

The July 26, 2021 notice indicated that it had 180 calendar days, or until January 24, 2022, to regain compliance with the Listing

On August 23, 2021, we effected the Reverse Split in order to the meet the minimum bid price of $1.00, and on September 14, 2021,

we received notice from Nasdaq that we were back in compliance.

On July 26, 2021, we received another notice from

Nasdaq indicating we that were not in compliance with the minimum bid price requirement of $1.00 per share under the Nasdaq Listing Rules.

The July 26, 2021 notice indicated that it had 180 calendar days, or until January 24, 2022, to regain compliance with the Listing Rules.

On August 23, 2021, we effected the Reverse Split in order to the meet the minimum bid price of $1.00, and on September 14, 2021, we received

notice from Nasdaq that we were back in compliance.

In the future, should we fail to meet the Nasdaq

5 unchanged sentences

including potential loss of confidence by partners, lenders, suppliers and employees.

Finally, delisting could make it harder for us

to raise capital and sell securities.

Finally, delisting could make it harder for us to

raise capital and sell securities.

We lost our foreign private issuer status,

9 unchanged sentences

be indicative of our future performance.

We may not be able to sustain our historical

rapid growth and/or may not be able to grow our business at all.

Our net revenue increased from $3.6 million for the fiscal year ended

July 31, 2017 and $5.3 million for the fiscal year ended July 31, 2018.

However, our net revenue decreased to $1.7 million,

$0.9 million and $0.6 million for the fiscal year ended July 31, 2022, 2021 and 2020, respectively.

Our net income was $0.6 million

for the fiscal year ended July 31, 2017, $1.9 million for the fiscal year ended July 31, 2018, and $0.4 million for the fiscal

year ended July 31, 2019, and decreased to a net loss of $17.3 million for the fiscal year ended July 31, 2020, and our net

losses were $3.4 million and $9.0 million for the years ended July 31, 2021 and 2022 respectively.

However, our historical growth rate,

limited history of operation, changes to business operations, among other factors, make it difficult to evaluate our prospects.

Substantial doubt about our ability to

continue as a going concern.

may not be able to sustain our historical rapid growth and/or may not be able to grow our business at all.

Our net revenue increased from

$3.6 million for the fiscal year ended July 31, 2017 and $5.3 million for the fiscal year ended July 31, 2018.

net revenue decreased to $1.7 million, $0.9 million and $0.6 million for the fiscal year ended July 31, 2022, 2021 and 2020,

respectively.

Our net income was $0.6 million for the fiscal year ended July 31, 2017, $1.9 million for the fiscal year ended July 31,

2018, and $0.4 million for the fiscal year ended July 31, 2019, and decreased to a net loss of $17.3 million for the fiscal year

ended July 31, 2020, and a net loss of $9.0 million for the fiscal year 2021, and our net losses were $2.9 million and $3.4 million

for the years ended July 31, 2023 and 2022 respectively.

However, our historical growth rate, limited history of operation, changes to

business operations, among other factors, make it difficult to evaluate our prospects.

Substantial doubt about our ability to continue

as a going concern.

Because of our losses from operations, working

2 unchanged sentences

ability to raise addition working capital through debt or equity financings.

We may incur liability for unpaid taxes,

including interest and penalties.

In the normal course of business, we may be subject

to challenges from various PRC taxing authorities regarding the amounts of taxes due.

The PRC taxing authorities may take the position

that we owe more taxes than we have paid.

We recorded tax liabilities of $Niland $0.1 million as of July 31, 2022 and 2021, respectively,

may incur liability for unpaid taxes, including interest and penalties.

the normal course of business, we may be subject to challenges from various taxing authorities regarding the amounts of taxes due.

taxing authorities may take the position that we owe more taxes than we have paid.

We recorded tax liabilities of approximately $31,200

and $0.1 million as of July 31, 2023 and 2022, respectively,

for the possible underpayment of income and business taxes.

It is possible that our tax for past taxes may be higher than those amounts

if the PRC authorities determine that we are subject to penalties or that we have not paid the correct amount.

Although our management

believes it may be able to negotiate with local PRC taxing authorities a reduction to any amounts that such authorities may believe are

due and a reduction to any interest or penalties thereon, we have no guarantee that we will be able to negotiate such a reduction.

the extent we are able to negotiate such amounts, national-level taxing authorities may take the position that localities are without

power to reduce such liabilities, and such PRC taxing authorities may attempt to collect unpaid taxes, interest and penalties in amounts

greatly exceeding management’s estimates.

We face business disruption and related

risks resulting from the recent outbreak of the novel coronavirus 2019 (COVID-19), which could have a material adverse effect on our

business plan.

Our financial consulting services to small and

mid-size enterprises (“SMEs”) and the businesses of the SMEs could be disrupted and materially adversely affected by the

recent outbreak of COVID-19.

As a result of measures imposed by the China governments in affected regions, businesses and schools have

been suspended due to quarantines intended to contain this outbreak.

The spread of COVID-19 from China to other countries has resulted

in the Director General of the World Health Organization declaring the outbreak of COVID-19 as a Public Health Emergency of International

Concern (PHEIC), based on the advice of the Emergency Committee under the International Health Regulations (2005), and the Centers for

Disease Control and Prevention in the U.S.

issued a warning on February 25, 2020 regarding the likely spread of COVID-19 to the

Even though the COVID-19 situation is now normalizing internationally, however, the Chinese government is continuing to impose strict

measures which could negatively affect the Chinese economy, and has continued to contribute to the on-going slow-down of the Chinese

We are continuing to assess our business plans and the impact COVID-19 may have on our ability to provide financial consulting

services to SMEs and to the SMEs’ businesses, but there can be no assurance that this analysis will enable us to avoid part or

all of any impact from the spread of COVID-19 or its consequences, including downturns in business sentiment generally or in our sector

in particular.

In addition, no assurance can be given that there would not be a future outbreak of COVID-19 which may result in additional

quarantine and other measures taken to try to prevent the spread of COVID-19, which may materially and adversely affect our financial

condition and results of operations.

if the authorities determine that we are subject to penalties or that we have not paid the correct amount.

Although our management believes

it may be able to negotiate with local taxing authorities a reduction to any amounts that such authorities may believe are due and a

reduction to any interest or penalties thereon, we have no guarantee that we will be able to negotiate such a reduction.

To the extent

we are able to negotiate such amounts, national-level taxing authorities may take the position that localities are without power to reduce

such liabilities, and such taxing authorities may attempt to collect unpaid taxes, interest and penalties in amounts greatly exceeding

management’s estimates.

Changes in the U.S.

1 unchanged sentence

make our services less attractive to our clients and adversely affect our business and financial condition.

Our consulting services help our clients based

in mainland China become public companies.

We are expanding our consulting services to include Chinese domestic exchanges and the Hong

Kong Stock Exchange, but currently, all of our former and current clients have chosen to go public in the U.S.

We believe this is due

to the more flexible rules provided by the U.S.

OTC markets and exchanges than the Chinese domestic exchanges, as well as the attractive

financing and growth opportunities the U.S.

capital market, which has remained relatively stable comparing to the Chinese capital market,

are perceived to be able to provide to the Chinese enterprises.

As a result, our going public consulting business has flourished since

its inception in 2015.

Our consulting services help our clients become

public companies.

For the year ended July 31, 2023, our clients were primarily based in Hong Kong and North America.

We are expanding

our consulting services to include Chinese domestic exchanges and the Hong Kong Stock Exchange, but currently, all of our former and current

clients have chosen to go public in the U.S.

We believe this is due to the more flexible rules provided by the U.S.

OTC markets and

exchanges than the Chinese domestic exchanges, as well as the attractive financing and growth opportunities the U.S.

capital market, which

has remained relatively stable comparing to the Chinese capital market, are perceived to be able to provide to the Chinese enterprises.

As a result, our going public consulting business has flourished since its inception in 2015.

However, changes in the U.S.

capital markets could make our service less desirable to Chinese enterprises.

example, if the U.S.

OTC markets and exchanges make their rules more stringent to Chinese enterprises, then fewer Chinese enterprises

will be able to use our consulting services to go public in the U.S., and our business and financial condition will be adversely affected

Because we lack a diversified client base,

a severe or prolonged downturn in Chinese economy could materially and adversely affect our business and our financial condition.

Our goal is to become an international business

serving clients throughout Asia, but as of the date of this annual report all our former and current clients are based in mainland China.

Accordingly, we do not have a geographically diversified client base, and there will be a potentially devastating effect on our business

if the Chinese economy experiences a severe or prolonged downturn.

capital markets

could make our service less desirable to Chinese enterprises.

For example, if the U.S.

OTC markets and exchanges make their rules more

stringent to Chinese enterprises, then fewer Chinese enterprises will be able to use our consulting services to go public in the U.S.,

and our business and financial condition will be adversely affected as a result.

Failure to maintain or enhance our brand

7 unchanged sentences

developing and maintaining quality of services across our operations, as well as our ability to respond to competitive pressures.

we are unable to satisfy customers’ needs or if our public image or reputation were otherwise diminished, our business transactions

are unable to satisfy customers’ needs or if our public image or reputation were otherwise diminished, our business transactions

with our clients may decline, which could in turn adversely affect our results of operations.

2 unchanged sentences

There is no assurance that we will be able to

implement important strategic initiatives in accordance with our expectations, which may result in an adverse impact on our business

and financial results.

Our new strategic initiatives, AT Consulting Center and CNNM, which were launched in 2018, and the investment

and financing analysis reporting business, which was launched in July 2019, are designed to create growth, improve our results of

operations and drive long-term shareholder value.

However, our management may lack required experience, knowledge, insight, or human

and capital resources to carry out the effective implementation to expand into new spaces outside the financial consulting industry.

As such, we may not be able to realize our expected growth, and our business and financial results will be adversely impacted.

implement important strategic initiatives in accordance with our expectations, which may result in an adverse impact on our business and

financial results.

Our new strategic initiatives, AT Consulting Center and CNNM, which were launched in 2018, and the investment and financing

analysis reporting business, which was launched in July 2019, are designed to create growth, improve our results of operations and

drive long-term shareholder value.

However, our management may lack required experience, knowledge, insight, or human and capital resources

to carry out the effective implementation to expand into new spaces outside the financial consulting industry.

As such, we may not be

able to realize our expected growth, and our business and financial results will be adversely impacted.

Increasing competition within our industry

7 unchanged sentences

may fluctuate due to the non-recurring nature of our going public consulting services provided to our clients.

We generated the bulk of our total revenues from

going public consulting services provided to small and medium-sized enterprises in China.

Unlike other service businesses that have the

potential of retaining their clients for long-term and recurring services, our consulting contractual relationships with our clients

usually last for 12 months;

there is no recurring business from our clients once they become public companies.

Therefore, we face the

constant challenge of identifying and recruiting new clients in order to maintain our operations and cash flows, which are difficult

for us to predict from year to year.

generated the bulk of our total revenues from going public consulting services provided to small and medium-sized enterprises.

Unlike other service businesses that have the potential of retaining their clients for long-term and recurring services, our consulting

contractual relationships with our clients usually last for 12 months;

there is no recurring business from our clients once they become

public companies.

Therefore, we face the constant challenge of identifying and recruiting new clients in order to maintain our operations

and cash flows, which are difficult for us to predict from year to year.

In addition, even though we screen our prospective

clients carefully before entering into service agreements, occasionally we have to discontinue our consulting services due to a variety

of unforeseeable reasons such as the client’s shortage in funds, disagreements regarding the going public process, and changes

in the client’s business and expectations, among others.

Due to the fact that our consulting fee is paid on installments, we will

not be able to realize the complete contracted amounts under these circumstances, without getting into potentially costly litigations.

of unforeseeable reasons such as the client’s shortage in funds, disagreements regarding the going public process, and changes in

the client’s business and expectations, among others.

Due to the fact that our consulting fee is paid on installments, we will not

be able to realize the complete contracted amounts under these circumstances, without getting into potentially costly litigations.

Arbitration proceedings, legal proceedings,

5 unchanged sentences

applicable laws and regulations.

As discussed below, we are engaged in a lawsuit relating to certain engagement agreements we had in

connection with our and Leaping Group Co.’s initial public offering.

As discussed below, we are engaged in a lawsuit relating to certain engagement agreements we had in connection

with our and Leaping Group Co.’s initial public offering.

On May 14, 2020, Boustead Securities, LLC (“Boustead”)

12 unchanged sentences

opted to amend its complaint and filed the amended complaint on November 10, 2020.

Boustead’s first amended complaint asserted

the same four causes of action against LGC and us as its original complaint.

We filed another motion to dismiss Boustead’s amended

complaint on December 8, 2020.

Boustead’s first amended complaint asserted the

same four causes of action against LGC and us as its original complaint.

We filed another motion to dismiss Boustead’s amended complaint

on December 8, 2020.

On August 25, 2021, the United States District

10 unchanged sentences

filed its opposition on February 1, 2022 and the Company replied on February 8, 2022.

On July 6, 2022, the Court denied our motion

to dismiss the second amended complaint.

Thereafter, on August 3, 2022, the Company filed a motion to compel arbitration of Boustead’s

claims in California.

Briefing on the Company’s motion to compel concluded on August 23, 2022.

The Court has yet to rule on that

Boustead is also seeking a default judgment against LGC and recently filed an order to show cause for default judgment against

The Court has not ruled on Boustead’s request for entry of default judgment against LGC.

In sum, the Boustead litigation is currently

in the pleadings stage.

Our management believes it is premature to assess and predict the outcome of this pending litigation.

As the operator of a website ipoex.com, we may be subject to

damages resulting from unauthorized access or hacking and other cyber risks.

Hacking is the process of attempting to gain

or successfully gaining unauthorized access to computer system.

As with any website, our website may be subject to hacking regardless

of whether we have in place securities systems which limit access to our platform.

When a person engages in website hacking, he or she

takes control of the website from the website owner.

Password hacking is obtaining a user’s secret password from data that has

been stored in or transmitted by a computer system.

Computer hacking is obtaining access to and viewing, creating or editing material

without authorization.

Hackers can bring a website down by causing large numbers of users to seek to access the website without the knowledge

of the users, which is known as denial-of-service hacking.

Despite our disclaimers, injured parties may seek to obtain damages from us

for their loss.

Thus, in additional to any financial or reputation losses that we may sustain, it is possible that a court or administrative

body may hold us liable for damages sustained by others.

Any such losses could materially impair our financial condition and our ability

to conduct business.

On July 6, 2022, the Court

denied our motion to dismiss the second amended complaint.

Thereafter, on August 3, 2022, the Company filed a motion to compel arbitration.

Briefing on the Company’s motion to compel concluded

on August 23, 2022 Since the agreement between ATIF and Boustead contains a valid arbitration clause that applies to Boustead’s

breach of contract claim, and the parties have not engaged in discovery, on February 14, 2023, the Court ordered that ATIF’s motion

to compel arbitration is granted and this case is stayed pending arbitration.

On March 10, 2023, Boustead

filed Demand for Arbitration against ATIF (the Respondent) before JAMS in California and the case Ref.

is 5220002783.

On May 25, 2023,

ATIF filed its answer to deny Boustead’s Demand for Arbitration, which was unsuccessful and the arbitration process was initiated.

The arbitrator ordered a motion to be filed by Boustead for a determination of contact interpretation, prior to extensive discovery into

issues such as the alleged merits and damages, and to determine whether the contract interpretation should allow the matter to further

Boustead had filed the Motion for Contract Interpretation Determination.

ATIF filed its opposition to that Motion on October

The hearing on the motion was held on November 8, 2023, during which

the arbitrator extended the hearing to February 29, 2024.

The arbitrator also established December 15, 2023, as the deadline for Boustead

to submit its reply regarding the contract interpretation issues raised by the Company.

Simultaneously, the Company was granted until

February 12, 2024, to present its response brief.

Our management believes it

is premature to assess and predict the outcome of this pending arbitration.

We may be subject to damages resulting from unauthorized access

or hacking and other cyber risks.

Hacking is the process of

attempting to gain or successfully gaining unauthorized access to computer system.

As with any website, our websites may be subject to

hacking regardless of whether we have in place securities systems which limit access to our platform.

When a person engages in website

hacking, he or she takes control of the website from the website owner.

Password hacking is obtaining a user’s secret password from

data that has been stored in or transmitted by a computer system.

Computer hacking is obtaining access to and viewing, creating or editing

material without authorization.

Hackers can bring a website down by causing large numbers of users to seek to access the website without

the knowledge of the users, which is known as denial-of-service hacking.

Despite our disclaimers, injured parties may seek to obtain damages

from us for their loss.

Thus, in additional to any financial or reputation losses that we may sustain, it is possible that a court or

administrative body may hold us liable for damages sustained by others.

Any such losses could materially impair our financial condition

and our ability to conduct business.

If we fail to hire, train, and retain qualified

17 unchanged sentences

rapid growth while maintaining consistent quality of services across our operations.

We must also provide continuous training to our

managerial and other employees so that they are equipped with up-to-date knowledge of various aspects of our operations and can meet

our demand for high-quality services.

If we fail to do so, the quality of our services may decrease, which in turn, may cause a negative

perception of our brand and adversely affect our business.

We must also provide continuous training to our managerial

and other employees so that they are equipped with up-to-date knowledge of various aspects of our operations and can meet our demand for

high-quality services.

If we fail to do so, the quality of our services may decrease, which in turn, may cause a negative perception of

our brand and adversely affect our business.

Any failure to protect our trademarks and

1 unchanged sentence

We believe our trademarks, “亞洲時代”

in Hong Kong, “ATIF” in Hong Kong and China, “亚洲时代” in China, “CNNM”

in Hong Kong “INTERNATIONAL SCHOOL OF FINANCE” in Hong Kong, “IPOEX” in China, the United Kingdom, the European

Union, and Singapore, and is also in the process of registration with the trademark office of Korea, and other intellectual property

rights are critical to our success.

Any unauthorized use of our trademarks and other intellectual property rights could harm our competitive

advantages and business.

Historically, China has not protected intellectual property rights to the same extent as the United States,

and infringement of intellectual property rights continues to pose a serious risk of doing business in China.

Monitoring and preventing

unauthorized use are difficult.

in Hong Kong, “ATIF” in Hong Kong and China, “亚洲时代” in China, “CNNM” in

Hong Kong “INTERNATIONAL SCHOOL OF FINANCE” in Hong Kong, “IPOEX” in China, the United Kingdom, the European Union,

and Singapore, and is also in the process of registration with the trademark office of Korea, and other intellectual property rights are

critical to our success.

Any unauthorized use of our trademarks and other intellectual property rights could harm our competitive advantages

and business.

Historically, China has not protected intellectual property rights to the same extent as the United States, and infringement

of intellectual property rights continues to pose a serious risk of doing business in China.

Monitoring and preventing unauthorized use

are difficult.

The measures we take to protect our intellectual property rights may not be adequate.

Furthermore, the

application of laws governing intellectual property rights in China and abroad is uncertain and evolving, and could involve substantial

If we are unable to adequately protect our brand, trademarks and other intellectual property rights, we may lose these rights

and our business may suffer materially.

Furthermore, the application of laws

governing intellectual property rights in China and abroad is uncertain and evolving, and could involve substantial risks to us.

are unable to adequately protect our brand, trademarks and other intellectual property rights, we may lose these rights and our business

may suffer materially.

As internet domain name rights are not rigorously

regulated or enforced in China, other companies may incorporate in their domain names elements similar in writing or pronunciation to

the “ATIF”, “CNNM,” and “INTERNATIONAL SCHOOL OF FINANCE,” and “IPOEX” trademarks or

their Chinese equivalents.

This may result in confusion between those companies and our company and may lead to the dilution of our brand

value, which could adversely affect our business.

Poor performance of our private equity

fund would cause a decline in our revenues, net income and cash flow and could adversely affect our ability to raise capital for future

When our private equity fund performs poorly,

either by incurring losses or underperforming benchmarks or our competitors, our investment record suffers.

Poor investment performance

by our private equity fund also adversely affects our incentive income and, all else being equal, may lead to a decline in our AUM, resulting

in a reduction of our management fees.

Moreover, in such circumstances, we may experience losses on our investments of our own capital.

If a fund performs poorly, we will receive little or no incentive income with regard to the fund and little income or possibly losses

from our own principal investment in the fund.

Poor performance of our private equity fund could also make it more difficult for us to

raise new capital.

Investors in our private equity fund may decline to invest in future funds we raise, and investors in our private

equity fund may withdraw their investments in the fund as a result of poor performance.

Our investors and potential investors continually

assess our fund’s performance, both on a standalone basis and relative to market benchmarks, our competitors, and other investment

products, and our ability to raise capital for existing and future funds and avoid excessive redemption levels depends on our fund’s

the “ATIF”, “CNNM,” and “INTERNATIONAL SCHOOL OF FINANCE,” and “IPOEX” trademarks or their

Chinese equivalents.

This may result in confusion between those companies and our company and may lead to the dilution of our brand value,

which could adversely affect our business.

We depend heavily on a limited number

We have derived, and believe

that we will continue to derive, a significant portion of our revenue from a limited number of clients for which we perform large projects.

In addition, revenue from a large client may constitute a significant portion of our total revenue in any particular quarter.

of any of our large clients for any reason, including as a result of the acquisition of that client by another entity, our failure to

meet that client’s expectations, the client’s decision to reduce spending on projects, or failure to collect amounts owed

to us from our client could have a material adverse effect on our business, financial condition and results of operations.

We rely on information

management systems and any damage, interruption or compromise of our information management systems or data could disrupt and harm our

rely upon information technology systems and networks, some of which are managed by third parties, to process, transmit, and store electronic

information in connection with the operation of our business.

Additionally, we collect and store data that is sensitive to our company.

Operating these information technology systems and networks and processing and maintaining this data, in a secure manner, are critical

to our business operations and strategy.

Our information management systems and the data contained therein may be vulnerable to damage,

including interruption due to power loss, system and network failures, operator negligence and similar causes.

techniques used to obtain unauthorized access, disable or degrade service or sabotage systems are constantly evolving and often are not

recognized until launched against a target, or even some time after.

We may be unable to anticipate these techniques, implement adequate

preventative measures or remediate any intrusion on a timely or effective basis even if our security measures are appropriate, reasonable,

and/or comply with applicable legal requirements.

Certain efforts may be state-sponsored and supported by significant financial and technological

resources, making them even more sophisticated and difficult to detect.

Insider or employee cyber and security threats are also a significant

concern for all companies, including ours.

Given the unpredictability of the timing, nature and scope of such disruptions, we could potentially

be subject to production downtimes, operational delays, other detrimental impacts on our operations or ability to provide products and

services to our customers, the compromising, misappropriation, destruction or corruption of data, security breaches, other manipulation

or improper use of our systems or networks, financial losses from remedial actions, loss of business or potential liability, and/or damage

to our reputation, any of which could have a material adverse effect on our competitive position, results of operations, cash flows or

financial condition.

Any significant compromise of our information management systems or data could impede or interrupt our business operations

and may result in negative consequences including loss of revenue, fines, penalties, litigation, reputational damage, inability to accurately

and/or timely complete required filings with government entities including the SEC and the Internal Revenue Service, unavailability or

disclosure of confidential information (including personal information) and negative impact on our stock price.

We may not be successful

in the implementation of our business strategy or our business strategy may not be successful, either of which will impede our development

We do not know whether we

will be able to continue successfully implementing our business strategy or whether our business strategy will ultimately be successful.

In assessing our ability to meet these challenges, a potential investor should take into account our lack of operating history, our management’s

relative inexperience, the competitive conditions existing in our industry and general economic conditions.

Our growth is largely dependent

on our ability to successfully implement our business strategy.

Our revenues may be adversely affected if we fail to implement our business

strategy or if we divert resources to a business strategy that ultimately proves unsuccessful.

Our service offerings may not be accepted.

We constantly seek to modify

our service offerings to the marketplace.

As is typically the case evolving service offerings, anticipation of demand and market acceptance

are subject to a high level of uncertainty.

The success of our service offerings primarily depends on the interest of our customers.

general, achieving market acceptance for our services will require substantial marketing efforts and the expenditure of significant funds,

which we may not have available, to create awareness and demand among customers.

These risks could materially

affect our business, results of operation or financial condition and affect the value of our securities.

Additional risks and uncertainties

that are not yet identified may also materially harm our business, operating results and financial condition and could result in a complete

loss of your investment.

You could lose all or part of your investment.

For more information, see “Where You Can Find More Information.”

Relating to Doing Business in China

If we are unable to substantially comply

with any PRC rules and regulations, our financial condition and results of operations may be materially adversely affected.

Our ability to operate in China may be harmed

by changes in its laws and regulations, including those relating to taxation, environmental regulations, land use rights, property and

other matters.

The central or local governments of these jurisdictions may impose new, stricter regulations or interpretations of existing

regulations that would require additional expenditures and efforts on our part to ensure our compliance with such regulations or interpretations.

Accordingly, government actions in the future, including any decision not to continue to support recent economic reforms or regional

or local variations in the implementation of economic policies, could have a significant effect on economic conditions in China or particular

regions thereof, and could require us to divest ourselves of any interest we then hold in Chinese properties.

As such, our business operations of and the industries

we operate in may be subject to various government and regulatory interference in the provinces in which they operate.

We could be subject

to regulation by various political and regulatory entities, including various local and municipal agencies and government sub-divisions.

We may incur increased costs necessary to comply with existing and newly adopted laws and regulations or penalties for any failure to

In the event that we are not able to substantially comply with any existing or newly adopted laws and regulations, our business

operations may be materially adversely affected and the value of our ordinary shares may significantly decrease.

Furthermore, the PRC government authorities may

strengthen oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers like us.

Such actions taken by the PRC government authorities may intervene or influence our operations at any time, which are beyond our control.

Therefore, any such action may adversely affect our operations and significantly limit or hinder our ability to offer or continue to

offer securities to you and reduce the value of such securities.

The PRC’s stock regulators statements

regarding PRC companies seeking listing abroad, such as the United States, may adversely affect our business.

Recently, the PRC has stated that it plans to

propose new rules that would ban companies with large amounts of sensitive consumer data from going public in the U.S.

which could deter

PRC company tech firms to list abroad.

The PRC has primarily focused on firms in the internet, telecommunications and education industry

from listing abroad due to political or national-security concerns.

As a result of these statements, this position by the PRC could adversely

affect our business consulting services which assist PRC companies to go public in the United States.

A severe or prolonged downturn in the global

or Chinese economy could materially and adversely affect our business and our financial condition.

Although the Chinese economy has grown steadily

in the past decade, there is considerable uncertainty over the long-term effects of the expansionary monetary and fiscal policies adopted

by the People’s Bank of China and financial authorities of some of the world’s leading economies, including the United States

There have been concerns over unrest and terrorist threats in the Middle East, Europe, and Africa, which have resulted in

volatility in oil and other markets.

There have also been concerns on the relationship among China and other Asian countries, which may

result in or intensify potential conflicts in relation to territorial disputes.

Economic conditions in China are sensitive to global

economic conditions, as well as changes in domestic economic and political policies and the expected or perceived overall economic growth

rate in China.

Any severe or prolonged slowdown in the global or Chinese economy may materially and adversely affect our business, results

of operations and financial condition.

The recent state government interference

into business activities on U.S.

listed Chinese companies may negatively impact our existing and future operations in China.

Recently, the Chinese government announced that

it would step up supervision of Chinese companies listed offshore.

Under the new measures, China will improve regulation of cross-border

data flows and security, crack down on illegal activity in the securities market and punish fraudulent securities issuance, market manipulation

and insider trading, China will also check sources of funding for securities investment and control leverage ratios.

The Cyberspace Administration

of China (“CAC”) has also opened a cybersecurity probe into several U.S.-listed tech giants focusing on anti-monopoly, financial

technology regulation and more recently, with the passage of the Data Security Law, how companies collect, store, process and transfer

We are headquartered and have operations in China.

We currently do not, and we do not plan to use variable interest entities to execute our business plan or to conduct our China-based

However, because we have operations in China, there is always a risk that the Chinese government may in the future seek to

intervene or influence operations of any company with any level of operations in China, including its ability to offer securities to

investors, list its securities on a U.S.

or other foreign exchange, conduct its business or accept foreign investment.

In light of China’s

recent announcements, there are risks and uncertainties which we cannot foresee for the time being, and rules and regulations in China

can change quickly with little or no advance notice.

The Chinese government may intervene or influence the Company’s current and

future operations in China at any time, or may exert more control over offerings conducted overseas and/or foreign investment in issuers

likes ourselves.

If any or all of the foregoing were to occur,

this could lead to a material change in our operations and/or the value of its common stock and/or significantly limit or completely

hinder its ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline

or be worthless.

Increases in labor costs in the PRC may

adversely affect our business and our profitability.

China’s economy has experienced increases

in labor costs in recent years.

China’s overall economy and the average wages in China are expected to continue to grow.

wage level for our employees has also increased in recent years.

We expect that our labor costs, including wages and employee benefits,

will continue to increase.

Our consulting service is heavy on labor costs, as the main cost of our business is compensation and benefits

for our professionals.

Unless we are able to pass on these increased labor costs to our customers by increasing prices for our services,

our profitability and results of operations may be materially and adversely affected.

In addition, we have been subject to stricter

regulatory requirements in terms of entering into labor contracts with our employees and paying various statutory employee benefits,

including pensions, housing fund, medical insurance, work-related injury insurance, unemployment insurance and maternity insurance to

designated government agencies for the benefit of our employees.

Pursuant to the PRC Labor Contract Law, or the Labor Contract Law, that

became effective in January 2008, its implementing rules that became effective in September 2008 and its amendments that

became effective in July 2013, employers are subject to stricter requirements in terms of signing labor contracts, minimum wages,

paying remuneration, determining the term of employees’ probation and unilaterally terminating labor contracts.

In the event that

we decide to terminate some of our employees or otherwise change our employment or labor practices, the Labor Contract Law and its implementing

rules may limit our ability to effect those changes in a desirable or cost-effective manner, which could adversely affect our business

and results of operations.

As the interpretation and implementation of labor-related

laws and regulations are still evolving, we cannot assure you that our employment practice does not and will not violate labor-related

laws and regulations in China, which may subject us to labor disputes or government investigations.

If we are deemed to have violated

relevant labor laws and regulations, we could be required to provide additional compensation to our employees and our business, financial

condition and results of operations could be materially and adversely affected.

Substantial uncertainties exist with respect

to the interpretation and implementation of any new PRC laws, rules and regulations relating to foreign investment and how it may impact

the viability of our current corporate structure, corporate governance and our business operations.

On March 15, 2019, the Standing Committee of

National People’s Congress promulgated the Foreign Investment Law, which came into effect on January 1, 2020 and replaced the three

existing laws regulating foreign investment in China, namely, the Sino-foreign Equity Joint Venture Enterprise Law, the Sino-foreign

Cooperative Joint Venture Enterprise Law and the Wholly Foreign-invested Enterprise Law, together with their implementation rules and

ancillary regulations.

The existing foreign-invested enterprises, or FIEs, established prior to the effectiveness of the Foreign Investment

Law may keep their corporate forms within five years.

The Foreign Investment Law stipulates that China implements the management system

of pre-establishment national treatment plus a negative list to foreign investment, and the government generally will not expropriate

foreign investment, except under certain special circumstances, in which case it will provide fair and reasonable compensation to foreign

Foreign investors are barred from investing in prohibited industries on the negative list and must comply with the specified

requirements when investing in restricted industries on such list.

On December 26, 2019, the State Council promulgated the Implementing

Regulations of the Foreign Investment Law, which came into effect on January 1, 2020 and further requires that FIEs and domestic enterprises

be treated equally with respect to policy making and implementation.

Pursuant to the Foreign Investment Law, “foreign

investment” means any foreign investor’s direct or indirect investment in the PRC, including:

(i) establishing FIEs in the

PRC either individually or jointly with other investors;

(ii) obtaining stock shares, stock equity, property shares, other similar interests

in Chinese domestic enterprises;

(iii) investing in new project in the PRC either individually or jointly with other investors;

making investment through other means provided by laws, administrative regulations or State Council provisions.

Although the Foreign

Investment Law does not explicitly classify the contractual arrangements, as a form of foreign investment, it contains a catch-all provision

under the definition of “foreign investment,” which includes investments made by foreign investors in China through other

means stipulated by laws or administrative regulations or other methods prescribed by the State Council without elaboration on the meaning

of “other means.” However, the Implementing Regulations of the Foreign Investment Law still does not specify whether foreign

investment includes contractual arrangements.

Changes in China’s economic, political,

or social conditions or government policies could have a material adverse effect on our business and results of operations.

All of our manufacturing operations are located

Accordingly, our business, prospects, financial condition and results of operations may be influenced to a significant degree

by political, economic and social conditions in China generally and by continued economic growth in China as a whole.

The Chinese economy differs from the economies

of most developed countries in many respects, including the amount of government involvement, level of development, growth rate, control

of foreign exchange and allocation of resources.

Although the Chinese government has implemented measures emphasizing the utilization

of market forces for economic reform, the reduction of state ownership of productive assets and the establishment of improved corporate

governance in business enterprises, a substantial portion of productive assets in China is still owned by the government.

the Chinese government continues to play a significant role in regulating industry development by imposing industrial policies and change

of enforcement practice of such rules and policies can change quickly with little advance notice.

While the Chinese economy has experienced significant

growth over the past decades, growth has been uneven, both geographically and among various sectors of the economy.

The Chinese government

has implemented various measures to encourage economic growth and guide the allocation of resources.

Some of these measures may benefit

the overall Chinese economy but may have a negative effect on us.

For example, our financial condition and results of operations may

be adversely affected by government control over capital investments or changes in tax regulations.

Since 2012, China’s economic

growth has slowed down.

Any prolonged slowdown in the Chinese economy may reduce the demand for our products and materially and adversely

affect our business and results of operations.

Uncertainties and quick change in the interpretation

and enforcement of Chinese laws and regulations with little advance notice could result in a material and negative impact our business

operation, decrease the value of our ordinary shares and limit the legal protections available to us.

The PRC legal system is based on written statutes,

and prior court decisions have limited value as precedents.

Since these laws and regulations are relatively new and the PRC legal system

continues to rapidly evolve, the interpretations of many laws, regulations and rules are not always uniform and enforcement of these

laws, regulations and rules involves uncertainties.

The enforcement of laws and that rules and regulations in China can change quickly

with little advance notice and the risk that the Chinese government may intervene or influence our operations at any time, or may exert

more control over offerings conducted overseas and/or foreign investment in China- based issuers, could result in a material change in

our operations and/or the value of our ordinary shares.

We cannot rule out the possibility that the PRC

government will institute a licensing regime or pre-approval requirement covering our industry at some point in the future.

licensing regime or approval requirement were introduced, we cannot assure you that we would be able to obtain any newly required license

in a timely manner, or at all, which could materially and adversely affect our business and impede our ability to continue our operations.

From time to time, we may have to resort to administrative

and court proceedings to enforce our legal rights.

However, since PRC administrative and court authorities have some discretion in interpreting

and implementing statutory and contractual terms, it may be difficult to evaluate the outcome of administrative and court proceedings.

Furthermore, the PRC legal system is based in part on government policies and internal rules (some of which are not published in a timely

manner or at all) that may have retroactive effect.

As a result, we may not be aware of our violation of these policies and rules until

sometime after the violation.

Such uncertainties, including uncertainty over the scope and effect of our contractual, property (including

intellectual property) and procedural rights, could materially and adversely affect our business and impede our ability to continue our

We are not in compliance with the PRC’s

regulations relating to offshore investment activities by PRC residents, and as a result, we and our shareholders may be subject to severe

penalties if we are not able to remediate the non-compliance.

In July 2014, SAFE promulgated the Circular

on Issues Concerning Foreign Exchange Administration Over the Overseas Investment and Financing and Roundtrip Investment by Domestic

Residents Via Special Purpose Vehicles, or Circular 37, which replaced Relevant Issues Concerning Foreign Exchange Control on Domestic

Residents’ Corporate Financing and Roundtrip Investment through Offshore Special Purpose Vehicles, or Circular 75.

requires PRC residents to register with local branches of SAFE in connection with their direct establishment or indirect control of an

offshore entity, referred to in Circular 37 as a “special purpose vehicle” for the purpose of holding domestic or offshore

assets or interests.

Circular 37 further requires amendment to a PRC resident’s registration in the event of any significant changes

with respect to the special purpose vehicle, such as an increase or decrease in the capital contributed by PRC individuals, share transfer

or exchange, merger, division or other material event.

Under these regulations, PRC residents’ failure to comply with specified

registration procedures may result in restrictions being imposed on the foreign exchange activities of the relevant PRC entity, including

the payment of dividends and other distributions to its offshore parent, as well as restrictions on capital inflows from the offshore

entity to the PRC entity, including restrictions on its ability to contribute additional capital to its PRC subsidiaries.

Further, failure

to comply with the SAFE registration requirements could result in penalties under PRC law for evasion of foreign exchange regulations.

We have requested our shareholders who are Chinese

residents to make the necessary applications, filings, and amendments as required under Circular 37 and other related rules.

we cannot provide any assurances that all of our shareholders who are Chinese residents will comply with our request to make or obtain

any applicable registration.

Any failure by any of our shareholders who is a PRC resident, or is controlled by a PRC resident, to comply

with relevant requirements under these regulations could subject us to fines or sanctions imposed by the PRC government, including restrictions

on Huaya’s ability to pay dividends or make distributions to us and on our ability to increase our investment in Huaya.

we have transferred all our equity interest in Huaya on May 31,2022 and since then, we shall not be affected by the above restrictions.

We are not in compliance with the PRC’s

regulations relating to employees’ housing funds, and as a result, we and our shareholders may be subject to penalties if we are

not able to remediate the non-compliance.

In accordance with the Regulations on Management

of Housing Provident Fund (the “Regulations of HPF”), which were promulgated by the PRC State Council on April 3, 1999,

and last amended on March 24, 2002, employers must register at the designated administrative centers and open bank accounts for employees’

housing funds deposits.

Employers and employees are also required to pay and deposit housing funds, in an amount no less than 5% of the

monthly average salary of each of the employees in the preceding year in full and on time.

Huaya has registered at the designated administrative

centers and opened bank accounts for its employees’ housing funds deposits.

However, Huaya has not deposited the housing funds for

all the employees with an amount no less than 5% of the monthly average salary of the employee in compliance with the relevant regulations

since June 2019 to May 31,2022, which might subject us to pay and deposit housing funds in full and on time within the prescribed time

limit by relevant authorities.

If we fail to do so, relevant authorities could file applications to competent courts for compulsory enforcement

of payment and deposit.

Since May 31,2022, all our equity interest in Huaya has been transferred, and we will not be liable to pay

and deposit housing funds for its employees.

Because our business is conducted in RMB

and the price of our Ordinary Shares is quoted in U.S.

dollars, changes in currency conversion rates may affect the value of your investments.

currently cooperate with Huaya to expand our business in the PRC, our books and records are maintained in RMB, which is the currency

of the PRC, and the financial statements that we file with the SEC and provide to our shareholders are presented in U.S.

in the exchange rate between the RMB and U.S.

dollar affect the value of our assets and the results of our operations in U.S.

The value of the RMB against the U.S.

dollar and other currencies may fluctuate and is affected by, among other things, changes in the

PRC’s political and economic conditions and perceived changes in the economy of the PRC and the United States.

Any significant

revaluation of the RMB may materially and adversely affect our cash flows, revenue, and financial condition.

Under the PRC Enterprise Income Tax Law,

or the EIT Law, we may be classified as a “resident enterprise” of China, which could result in unfavorable tax consequences

to us and our non-PRC shareholders.

The EIT Law and its implementing rules provide

that enterprises established outside of China whose “de facto management bodies” are located in China are considered “resident

enterprises” under PRC tax laws.

The implementing rules promulgated under the EIT Law define the term “de facto management

bodies” as a management body which substantially manages, or has control over the business, personnel, finance and assets of an

In April 2009, the State Administration of Taxation, or SAT, issued a notice, known as SAT Notice 82, which provides

certain specific criteria for determining whether a PRC-controlled offshore incorporated enterprise will be regarded as a PRC tax resident

by virtue of having a “de facto management body” in China.

However, there are no further detailed rules or precedents

governing the procedures and specific criteria for determining “de facto management body.” Although our board of directors

and management are located in the PRC, it is unclear if the PRC tax authorities would determine that we should be classified as a PRC

“resident enterprise.”

If we are deemed as a PRC “resident enterprise,”

we will be subject to PRC enterprise income tax on our worldwide income at a uniform tax rate of 25%, although dividends distributed

to us from our existing PRC subsidiary and any other PRC subsidiaries which we may establish from time to time could be exempt from the

PRC dividend withholding tax due to our PRC “resident recipient” status.

This could have a material and adverse effect on

our overall effective tax rate, our income tax expenses, and our net income.

Furthermore, dividends, if any, paid to our shareholders

may be decreased as a result of the decrease in distributable profits.

In addition, if we were considered a PRC “resident enterprise”,

any dividends we pay to our non-PRC investors, and the gains realized from the transfer of our Ordinary Shares may be considered income

derived from sources within the PRC and be subject to PRC tax, at a rate of 10% in the case of non-PRC enterprises or 20% in the case

of non-PRC individuals (in each case, subject to the provisions of any applicable tax treaty).

It is unclear whether holders of our Ordinary

Shares would be able to claim the benefits of any tax treaties between their country of tax residence and the PRC in the event that we

are treated as a PRC resident enterprise.

This could have a material and adverse effect on the value of your investment in us and the

price of our Ordinary Shares.

There are significant uncertainties under

the EIT Law relating to the withholding tax liabilities of our PRC subsidiary, and dividends payable by our PRC subsidiary to our offshore

subsidiaries may not qualify to enjoy certain treaty benefits.

Under the EIT Law and its implementation rules,

the profits of a foreign invested enterprise generated through operations, which are distributed to its immediate holding company outside

the PRC, will be subject to a withholding tax rate of 10%.

Pursuant to a special arrangement between Hong Kong and the PRC, such rate

may be reduced to 5% if a Hong Kong resident enterprise owns more than 25% of the equity interest in the PRC company.

Our PRC subsidiary

is wholly-owned by our Hong Kong subsidiary.

Moreover, under the Notice of the State Administration of Taxation on Issues regarding the

Administration of the Dividend Provision in Tax Treaties promulgated on February 20, 2009, the tax payer needs to satisfy certain

conditions to enjoy the benefits under a tax treaty.

These beneficial owners of the relevant dividends and the corporate shareholder

to receive dividends from the PRC subsidiary must have continuously met the direct ownership thresholds during the 12 consecutive months

preceding the receipt of the dividends.

Pursuant to the Announcement of the State Administration of Taxation on Issues Relating to “Beneficial

Owner” in Tax Treaties promulgated by SAT on February 3, 2018 and became effective on April 1, 2018, certain detailed factors are

set forth and a beneficial ownership analysis will be applied in light of the actual circumstances of the specific cases in determining

the “beneficial owner” status under the relevant tax treaty and whether or not to grant tax treaty benefits.

In current practice,

a Hong Kong enterprise must obtain a tax resident certificate from the relevant Hong Kong tax authority to apply for the 5% lower PRC

withholding tax rate.

As the Hong Kong tax authority will issue such a tax resident certificate on a case-by-case basis, we cannot assure

you that we will be able to obtain the tax resident certificate from the relevant Hong Kong tax authority.

As of the date of this annual

report, we have not commenced the application process for a Hong Kong tax resident certificate from the relevant Hong Kong tax authority,

and there is no assurance that we will be granted such a Hong Kong tax resident certificate.

Even after we obtain the Hong Kong tax resident

certificate, we are required by applicable tax laws and regulations to file required forms and materials with relevant PRC tax authorities

to prove that we can enjoy 5% lower PRC withholding tax rate.

ATIF HK intends to obtain the required materials and file with the relevant

tax authorities when it plans to declare and pay dividends, but there is no assurance that the PRC tax authorities will approve the 5%

withholding tax rate on dividends received from ATIF HK.

PRC regulation of loans to and direct investment

in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from making loans

or additional capital contributions to our PRC subsidiary, which could materially and adversely affect our liquidity and our ability

to fund and expand our business.

Any funds we transfer to our PRC subsidiary,

either as a shareholder loan or as an increase in registered capital, are subject to approval by or registration with relevant governmental

authorities in China.

According to the relevant PRC regulations on foreign-invested enterprises, or FIEs, the combined amount of offshore

capital contributions and loans cannot exceed the FIE’s approved total investment amount.

Any capital contributions to our PRC

subsidiary must be filed with MOFCOM or its local counterparts, and registered with a local bank authorized by the State Administration

of Foreign Exchange, or SAFE.

In addition, (a) any loan provided by us to WFOE, which is a FIE, cannot exceed the difference between

its total investment amount and registered capital, and must be registered with SAFE or its local counterparts, and (b) any loan

provided by us to our VIE which is a domestic PRC entity, over a certain threshold, must be approved by the relevant government authorities

and must be registered with SAFE or its local counterparts.

Given that the registered capital and total investment amount of WFOE are

currently the same, if we seek to make a capital contribution to WFOE we must first apply to increase both its registered capital and

total investment amount, while if we seek to provide a loan to WFOE, we must first increase its total investment amount.

currently do not have any immediate plans to utilize the proceeds from our initial public offering (“IPO”) to make capital

contribution into WFOE or provide any loan to WFOE or to our VIE, if we seek to do so in the future, we may not be able to obtain the

required government approvals or complete the required registrations on a timely basis, if at all.

If we fail to receive such approvals

or complete such registrations, our ability to use the proceeds of our IPO and to capitalize our PRC operations may be negatively affected,

which could adversely affect our liquidity and our ability to fund and expand our business.

On March 30, 2015, SAFE promulgated the

Circular on Reforming the Management Approach Regarding the Foreign Exchange Capital Settlement of Foreign-Invested Enterprises, or SAFE

SAFE Circular 19 launched a nationwide reform of the administration of the settlement of the foreign exchange capitals of

FIEs and allows FIEs to settle their foreign exchange capital at their discretion, but continues to prohibit FIEs from using the RMB

fund converted from their foreign exchange capitals for expenditure beyond their business scopes, providing entrusted loans or repaying

loans between non-financial enterprises.

Violations of these Circulars could result in severe monetary or other penalties.

SAFE Circular

19 and relevant foreign exchange regulatory rules may significantly limit our ability to use RMB converted from the net proceeds

of our IPO to fund the establishment of new entities in China by our consolidated affiliates, to invest in or acquire any other PRC companies

through our PRC subsidiary or consolidated affiliates or to establish new consolidated affiliates in the PRC, which may adversely affect

our business, financial condition, and results of operations.

If we become directly subject to the scrutiny,

criticism, and negative publicity involving U.S.-listed Chinese companies, we may have to expend significant resources to investigate

and resolve the matter which could harm our business operations, stock price, and reputation.

public companies that have substantially

all of their operations in China have been the subject of intense scrutiny, criticism, and negative publicity by investors, financial

commentators, and regulatory agencies, such as the SEC.

Much of the scrutiny, criticism, and negative publicity has centered on financial

and accounting irregularities and mistakes, a lack of effective internal controls over financial accounting, inadequate corporate governance

policies or a lack of adherence thereto, and, in many cases, allegations of fraud.

As a result of the scrutiny, criticism, and negative

publicity, the publicly traded stock of many U.S.

listed Chinese companies sharply decreased in value and, in some cases, has become

virtually worthless.

Many of these companies are now subject to shareholder lawsuits and SEC enforcement actions and are conducting internal

and external investigations into the allegations.

It is not clear what effect this sector-wide scrutiny, criticism, and negative publicity

will have on us, our business, and our stock price.

If we become the subject of any unfavorable allegations, whether such allegations

are proven to be true or untrue, we will have to expend significant resources to investigate such allegations and/or defend our company.

This situation will be costly and time consuming and distract our management from growing our business.

If such allegations are not proven

to be groundless, we and our business operations will be severely affected and you could sustain a significant decline in the value of

If the Chinese government were to impose

new requirements for permission or approval from the PRC Authorities including China Securities Regulatory Commission (“CSRC”)

or CAC, or any other entity that is required to approve this offering, to issue our ordinary shares to foreign investors or list on a

foreign exchange, such action could significantly limit or completely hinder our ability to offer or continue to offer securities to

investors and cause the value of such securities to significantly decline or be worthless.

Our PRC counsel, Dentons Law Firm, has advised

us based on their understanding of the current PRC laws, rules, and regulations that as of the date of this prospectus, we and our PRC

subsidiaries, (1) are not required to obtain permissions from any PRC authorities to operate or issue our Ordinary Shares to foreign

investors, (2) are not subject to permission requirements from the CSRC, CAC or any other entity that is required to approve of our PRC

subsidiaries’ operations, and (3) have not received or were denied such permissions by any PRC authorities.

Nevertheless, the General

Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the “Opinions

on Severely Cracking Down on Illegal Securities Activities According to Law,” or the Opinions, which were made available to the

public on July 6, 2021.

The Opinions emphasized the need to strengthen the administration over illegal securities activities, and the

need to strengthen the supervision over overseas listings by Chinese companies.

On November 16, 2021, thirteen departments including

Cyberspace Administration of China,the China Securities Regulatory Commission and the Ministry of Commerce jointly promulgated the Measures

for Cyber Security Examination, which will be effective on February 15, 2022.

The Measures for Cyber Security Examination include data

processing activities of network platform operators that affect or may affect national security into cyber security review, and make

it clear that network platform operators with personal information of more than one million users must apply for cyber security review

to the Cyber security Review Office when they go public abroad.

The CSRC issued “Administrative Provisions of The State Council

on Overseas Issuance and Listing of Securities by Domestic Enterprises (Draft for Public Comments)” (“Administrative Provisions”)

and “Measures for the Administration of Filing overseas Issuance and Listing of Securities by Domestic Enterprises (Draft for Public

Comments)” (“Measures”) to solicit public opinions on December 24, 2021.

The Administrative Provisions and Measures

stipulate that no matter the domestic enterprises are directly or indirectly listed (including variable interest entities structure),

the filing with CSRC management will be uniformly applied.

The National Development and Reform Commission and the Ministry of Commerce

issued the Special Administrative Measures for Foreign Investment Access (Negative List) (2021 version) (“Negative List”)

on December 27, 2021 , which will come into force on January 1, 2022.

Compared to the previous version, there aren’t any new specific

industries added to the negative list.

Given the current PRC regulatory environment, it is uncertain when and whether we or our PRC subsidiaries,

will be required to obtain permission from the PRC government to list on U.S.

exchanges in the future, and even when such permission

is obtained, whether it will be denied or rescinded.

Further, since these statements and regulatory

actions are new, it is highly uncertain how soon legislative or administrative regulation making bodies will respond and what existing

or new laws or regulations or detailed implementations and interpretations will be modified or promulgated, if any, and the potential

impact such modified or new laws and regulations will have on our daily business operation, the ability to accept foreign investments

and list on an U.S.

If, (i) we inadvertently conclude that such approvals or permissions are not required, or (ii) applicable

laws, regulations, or interpretations change and we are required to obtain such approvals and permissions in the future, and we are unable

to obtain such approvals and permissions, Borqs will not be able to perform R&D and manufacturing in China, our revenues will be

adversely affected and we will have to expand our R&D activities in India and relocate our manufacturing activities outside China

to India or other Asian countries.

Also, if applicable laws, regulations, or interpretations change, and we are required to obtain permission

or approval from the PRC authority for the offering of our Ordinary Shares in the U.S.

in the future, and if any of such permission or

approval were not received maintained, or subsequently rescinded, it may significantly limit or completely hinder our ability to complete

this offering or cause the value of our Ordinary Shares to significantly decline or become worthless

The disclosures in our reports and other

filings with the SEC and our other public pronouncements are not subject to the scrutiny of any regulatory bodies in the PRC.

We are regulated by the SEC and our reports and

other filings with the SEC are subject to SEC review in accordance with the rules and regulations promulgated by the SEC under the

Securities Act of 1933 (the “Securities Act”) and the Securities Exchange Act of 1934 (the “Exchange Act”).

SEC reports and other disclosures and public pronouncements are not subject to the review or scrutiny of any PRC regulatory authority.

For example, the disclosure in our SEC reports and other filings are not subject to the review by the China Securities Regulatory Commission,

a PRC regulator that is responsible for oversight of the capital markets in China.

Accordingly, you should review our SEC reports, filings,

and our other public pronouncements with the understanding that no local regulator has done any review of us, our SEC reports, other

filings or any of our other public pronouncements.

The failure to comply with PRC regulations

relating to mergers and acquisitions of domestic entities by offshore special purpose vehicles may subject us to severe fines or penalties

and create other regulatory uncertainties regarding our corporate structure.

On August 8, 2006, MOFCOM, joined by the

CSRC, the State-owned Assets Supervision and Administration Commission of the State Council, the SAT, the State Administration for Industry

and Commerce (the “SAIC”), and SAFE, jointly promulgated regulations entitled the Provisions Regarding Mergers and Acquisitions

of Domestic Entities by Foreign Investors (the “M&A Rules”), which took effect as of September 8, 2006, and as amended

on June 22, 2009.

The M&A Rules stipulate that foreign investors shall comply with the M&A Rules when they purchase equity

interests of a domestic company or subscribe the increased capital of a domestic company, and thus changing the nature of the domestic

company into a foreign-invested enterprise, when the foreign investors establish a foreign-invested enterprise in the PRC, purchase the

assets of a domestic company and operate the assets, or when the foreign investors purchase the assets of a domestic company, establish

a foreign-invested enterprise by injecting such assets, and operate the assets.

As for merger and acquisition of a domestic company with

a related party relationship by a domestic company, enterprise or natural person in the name of an overseas company legitimately incorporated

or controlled by the domestic company, enterprise of natural person, such merger and acquisition shall be subject to examination and

approval of MOFCOM.

The parties involved shall not use domestic investment by foreign investment enterprises or other methods to circumvent

the requirement of examination and approval.

These regulations, among other things, have certain provisions that require offshore special

purpose vehicles formed for the purpose of acquiring PRC domestic companies and controlled directly or indirectly by PRC individuals

and companies, to obtain the approval of MOFCOM prior to engaging in such acquisitions and to obtain the approval of the CSRC prior to

publicly listing their securities on an overseas stock market and trading of such special purpose vehicle’s securities on an overseas

stock exchange.

On September 21, 2006, the CSRC published on its official website a notice specifying the documents and materials

that are required to be submitted for obtaining CSRC approval.

The application of the M&A Rules with

respect to our corporate structure remains unclear, with no current consensus existing among leading PRC law firms regarding the scope

and applicability of the M&A Rules.

Thus, it is possible that the appropriate PRC government agencies, including MOFCOM, would deem

that the M&A Rules required us or our entities in China to obtain approval from MOFCOM or other PRC regulatory agencies.

the CSRC, MOFCOM, or another PRC regulatory agency determines that government approval was required, or if prior CSRC approval for overseas

financings is required and not obtained, we may face severe regulatory actions or other sanctions from MOFCOM, the CSRC, or other PRC

regulatory agencies.

In such event, these regulatory agencies may impose fines or other penalties on our operations in the PRC, limit

our operating privileges in the PRC, delay or restrict the repatriation of the proceeds from overseas financings into the PRC, restrict

or prohibit payment or remittance of dividends to us, or take other actions that could have a material adverse effect on our business,

financial condition, results of operations, reputation, and prospects, as well as the trading price of our Ordinary Shares.

or other PRC regulatory agencies may also take actions requiring us, or making it advisable for us, to delay or cancel overseas financings,

to restructure our current corporate structure, or to seek regulatory approvals that may be difficult or costly to obtain.

The M&A Rules, along with certain foreign

exchange regulations discussed below, will be interpreted or implemented by the relevant government authorities in connection with our

future offshore financings or acquisitions, and we cannot predict how they will affect our acquisition strategy.

or social conditions or government policies could have a material adverse effect on our business and operations.

the Company is engaged by clients in mainland China and Hong Kong and we derive revenue from mainland China and Hong Kong, our business,

financial condition, results of operations, and prospects may be influenced, to a degree, by political, economic, and social conditions

in China generally.

The Chinese economy differs from the economies of most developed countries in many respects, including the level

of government involvement, level of development, growth rate, control of foreign exchange, and allocation of resources.

Chinese government has implemented measures emphasizing the utilization of market forces for economic reform, including the reduction

of state ownership of productive assets and the establishment of improved corporate governance in business enterprises, a significant

portion of productive assets in China is still owned by the government.

In addition, the Chinese government continues to play a significant

role in regulating industries by imposing regulatory guidance or policies.

The Chinese government also exercises significant control

over China’s economic growth by allocating resources, controlling payment of foreign currency-denominated obligations, setting

monetary policies, and providing preferential treatment to particular industries or companies.

While the Chinese economy

has experienced significant growth over the past decades, growth has been uneven, both geographically and among various sectors of the

Any adverse changes in economic conditions in China, in the policies of the Chinese government, or in the laws and regulations

in China could have a material adverse effect on the overall economic growth of China.

Such developments could adversely affect our business

and operating results, reduce demand for our services, and weaken our competitive position.

The Chinese government has implemented various

measures to encourage economic growth and guided the allocation of various types of resources.

Some of these measures may benefit the

overall Chinese economy, but others may have a negative effect on our operations.

The legal system in the PRC

is not as developed as in some other jurisdictions, such as the U.S.

The PRC legal system is a civil law system based on written statutes.

Unlike the common law system, prior court decisions under the civil law system may be cited for reference but have limited precedential

Since these laws and regulations are relatively new and the PRC legal system continues to rapidly evolve, the interpretations of

many laws, regulations and rules are not always uniform and the enforcement of these laws, regulations and rules involves uncertainties.

Uncertainties arising from the legal system in China, including uncertainties regarding the interpretation and enforcement of PRC laws

and the possibility that regulations and rules can change quickly with little advance notice, could hinder our ability to offer or continue

to offer securities, result in a material adverse change to our client’s business operations and our ability to provide them services,

which could materially and adversely affect our financial condition and results of operations and cause our securities to significantly

decline in value or become worthless.

The Chinese government exerts substantial

influence over the manner in which we conduct our business activities in PRC.

The Chinese government has

exercised and continues to exercise substantial control over virtually every sector of the Chinese economy through regulations and state

Our ability and our PRC clients’ ability to conduct business in China may be harmed by changes in its laws and regulations,

including those relating to taxation, property and other matters, which could result in a material change in our operations, our PRC clients’

operations and the value of the securities we are registering.

The central or local governments of these jurisdictions may impose new

and restrictive regulations or interpretations of existing regulations that would require additional expenditures and efforts on our part

to ensure our compliance with such regulations or interpretations.

Accordingly, government actions in the future, including any decision

not to continue to support recent economic reforms and to return to a more centrally planned economy or regional or local variations in

the implementation of economic policies, could have a significant effect on economic conditions in China, and result in a material change

in our operations and/or that of our clients.

For example, the Chinese cybersecurity

regulator announced on July 2, 2021, that it had begun an investigation of Didi Global Inc.

DIDI) and two days later ordered that

Didi Global Inc.’s application be removed from all the smartphone application stores in China.

Given the example of Didi

and recent statements of by the Chinese government indicating an intent to exert more oversight and control overseas offerings

and foreign investments in Chinese companies, our Chinese clients’ business may be subject to various government and regulatory

interference once our Chinese clients’ shares are listed on a US stock exchange and such regulatory actions could significantly

limit or completely hinder our ability to offer or continue to offer our services to our clients in China and directly impact our revenue.

Although we are currently

not required to obtain any permission from any PRC government to conduct business in China, it will remain uncertain when and whether

we will be required to obtain any permission from the PRC government to provide services to Chinese companies, and even when we obtain

such permission in accordance with the new rules and regulations, it will be unclear whether such permission will be rescinded or revoked

at some point in time.

Changes in the policies of the PRC government

could have a significant impact upon our ability to generate revenue from the PRC.

Currently, a significant portion

of our clients operate and generate their revenue in the PRC.

Accordingly, economic, political and legal developments in the PRC will

significantly impact our customers’ business, financial condition, results of operations and prospects.

Policies of the PRC government

can have significant effects on economic conditions in the PRC and the ability of businesses to operate profitably.

As a result of our

customers’ business operation, our ability to conduct a profitable business in the PRC may be adversely affected by changes in policies

by the PRC government, including changes in laws, regulations or their interpretation.

As of the date of this annual report, we have not

been involved in any investigations on cybersecurity review initiated by any PRC regulatory authority, nor have we received any inquiry,

notice, or sanction related to cybersecurity review under the Cybersecurity Review Measures.

We have been closely monitoring

China’s regulatory developments regarding any approvals from the CSRC, the CAC, or other PRC regulatory authorities required for our business

However, significant uncertainty remains about enacting, interpreting, and implementing regulatory requirements related to

overseas securities offerings and other capital markets activities.

The PRC government may take actions to exert more oversight and control

over offerings by China-based issuers conducted overseas and/or foreign investment in such companies, which could significantly limit

or ultimately hinder our ability to offer or continue to offer services to companies looking to get listed outside China and which might

impact our revenue.

If it is determined in the future that the approval or permissions of the CSRC, the CAC, or any other regulatory authority

is required for the business operations and if we do not receive or maintain the approvals or permissions, or if we inadvertently conclude

that such approvals or permissions are not required, or applicable laws, regulations, or interpretations change such that we are required

to obtain approvals or permissions in the future, we may be subject to investigations by competent regulators, fines or penalties, ordered

to suspend our relevant operations and rectify any non-compliance, or take other actions prohibited from engaging in a relevant business

or conducting any offering.

These risks could result in a material adverse change in our operations, significantly impact our revenue

or ultimately hinder our ability to offer or continue to offer securities to investors, or cause such securities to decline in value or

become worthless.

In light of recent events indicating greater

oversight by the CAC over data security, we may be subject to a variety of PRC laws and other obligations regarding cybersecurity and

data protection, and any failure to comply with applicable laws and obligations could have a material adverse effect on our business,

our listing on the Nasdaq Capital Market, financial condition, results of operations, and the offering.

The Chinese regulatory requirements

with respect to cybersecurity and data privacy are constantly evolving and can be subject to varying interpretations, and significant

changes, resulting in uncertainties about the scope of our responsibilities in that regard.

Failure to comply with the PRC cybersecurity

and data privacy requirements in a timely manner, or at all, may subject our clients to government enforcement actions and investigations,

fines, penalties, suspension or disruption of their operations, among other things.

The Chinese Cybersecurity Law, which was adopted by

the National People’s Congress on November 7, 2016 and came into force on June 1, 2017, provide that personal information

and important data collected and generated by a critical information infrastructure operator in the course of its operations in China

must be stored in China, and the Cybersecurity Review Measures which became effective on February 15, 2022, provided that if a critical

information infrastructure operator purchases internet products and services that affect or may affect national security, it should be

subject to cybersecurity review by the CAC.

Due to the lack of further interpretations, the exact scope of what constitute a “CIIO”

remains unclear.

Further, the PRC government authorities may have wide discretion in the interpretation and enforcement of these laws.

On June 10, 2021, the Standing

Committee of the National People’s Congress promulgated the Data Security Law, which took effect on September 1, 2021.

Security Law requires that data shall not be collected by theft or other illegal means, and also provides for a data classification and

hierarchical protection system.

The data classification and hierarchical protection system puts data into different groups according to

its importance in economic and social development, and the damages it may cause to national security, public interests, or the legitimate

rights and interests of individuals and organizations in case the data is falsified, damaged, disclosed, illegally obtained or illegally

In addition, on December 28, 2021, a total of thirteen governmental departments of the PRC, including the PRC State Internet Information

Office, issued the Measures of Cybersecurity Review, according to which, a cybersecurity review is conducted by the CAC, to assess potential

national security risks that may be brought about by any procurement, data processing, or overseas listing.

The Measures of Cybersecurity

Review further, if effective, would require that critical information infrastructure operators and services and data processing operators

that possess personal data of at least one (1) million users must apply for a review by the Cybersecurity Review Office of PRC, if they

plan to conduct securities listings on foreign exchanges.

In addition to the new Measures of Cybersecurity Review, it also remains uncertain

whether any future regulatory changes may impose additional restrictions on our clients.

It remains uncertain as to

how the Cybersecurity Review Measures will be interpreted or implemented and whether the PRC regulatory agencies, including the CAC, may

adopt new laws, regulations, rules, or detailed implementation and interpretation related to the Cybersecurity Review Measures.

may experience disruptions to their operations should they be required to have a cybersecurity review by the CAC.

Any cybersecurity review

could also result in uncertainty to their US stock exchange listing, future offerings, negative impacts on our share trading prices and

diversion of our managerial and financial resources.

We may face negative tax implications due

to the termination of the VIE structure.

We have terminated the VIE

structure to mitigate the potential risks arising from the PRC government provision of new guidance to and restrictions on China-based

companies raising capital offshore and currently have no VIE structure in the corporate group.

However, if the relevant PRC tax authority

determines that the Exclusive Service Agreement under the terminated VIE arrangements had no reasonable business purpose and involved

unreasonable transfer pricing, there might be potential tax liabilities on ATIF BVI.

According to the provision under the PRC Enterprise

Income Tax Law, if the business transactions between related parties do not comply with principle of independent transaction and reduce

the taxable income or income, the tax authorities are entitled to make an adjustment by using a reasonable method.

Therefore, we cannot

provide any assurance that there is no retrospective tax or other liabilities or consequences on us due to the winding-up of the VIE structure.

Risks related to a future determination

that the Public Company Accounting Oversight Board (the “PCAOB”) is unable to inspect or investigate our auditor completely.

The audit report included in this prospectus,

and our annual report on Form 20-F for the year ended July 31, 2021, was issued by ZH CPA, a U.S.-based accounting firm that is registered

with the PCAOB and can be inspected by the PCAOB.

We have no intention of dismissing ZH CPA in the future or of engaging any auditor

not based in the U.S.

audit report included in our annual

report on Form 20-F for the year ended July 31, 2021, was issued by ZH CPA, a U.S.-based accounting firm that is registered with the PCAOB

and can be inspected by the PCAOB.

We have no intention of dismissing ZH CPA in the future or of engaging any auditor not based in the

and not subject to regular inspection by the PCAOB.

There is no guarantee, however, that any future auditor engaged

by the Company would remain subject to full PCAOB inspection during the entire term of our engagement.

The PCAOB is currently unable

to conduct inspections in China without the approval of Chinese government authorities.

If it is later determined that the PCAOB is unable

to inspect or investigate our auditor completely, investors may be deprived of the benefits of such inspection.

Any audit reports not

issued by auditors that are completely inspected by the PCAOB, or a lack of PCAOB inspections of audit work undertaken in China that

prevents the PCAOB from regularly evaluating our auditors’ audits and their quality control procedures, could result in a lack of assurance

that our financial statements and disclosures are adequate and accurate.

In addition, under the HFCAA, our securities may be prohibited

from trading on the Nasdaq or other U.S.

stock exchanges or in the over the counter trading market in the U.S.

if our auditor is not

inspected by the PCAOB for three consecutive years, and this ultimately could result in our Ordinary Shares being delisted.

on June 22, 2021, the U.S.

Senate passed the AHFCAA, which, if enacted, would amend the HFCAA and require the SEC to prohibit an issuer’s

securities from trading on any U.S.

There is no guarantee, however, that any future auditor engaged by the Company

would remain subject to full PCAOB inspection during the entire term of our engagement.

The PCAOB is currently unable to conduct inspections

in China without the approval of Chinese government authorities.

If it is later determined that the PCAOB is unable to inspect or investigate

our auditor completely, investors may be deprived of the benefits of such inspection.

Any audit reports not issued by auditors that are

completely inspected by the PCAOB, or a lack of PCAOB inspections of audit work undertaken in China that prevents the PCAOB from regularly

evaluating our auditors’ audits and their quality control procedures, could result in a lack of assurance that our financial statements

and disclosures are adequate and accurate.

In addition, under the HFCAA, our securities may be prohibited from trading on the Nasdaq or

stock exchanges or in the over the counter trading market in the U.S.

if its auditor is not subject

to PCAOB inspections for two consecutive years instead of three.

if our auditor is not inspected by the PCAOB for three

consecutive years, and this ultimately could result in our Ordinary Shares being delisted.

Furthermore, on June 22, 2021, the U.S.

passed the AHFCAA, which w as signed into law on

December 29, 2022, amending the HFCAA and requiring the SEC to prohibit an issuer’s securities from trading on any U.S.

stock exchange

if its auditor is not subject to PCAOB inspections for two consecutive years instead of three consecutive years.

On December 2, 2021, SEC has announced the adoption

of amendments to finalize rules implementing the submission and disclosure requirements in the HFCAA.

The rules apply to registrants

the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located

in a foreign jurisdiction and that the PCAOB is unable to inspect or investigate (Commission-Identified Issuers).

The final amendments

require Commission-Identified Issuers to submit documentation to the SEC establishing that, if true, it is not owned or controlled by

a governmental entity in the public accounting firm’s foreign jurisdiction.

The amendments also require that a Commission-Identified

Issuer that is a “foreign issuer,” as defined in Exchange Act Rule 3b-4, provide certain additional disclosures in its annual

report for itself and any of its consolidated foreign operating entities.

Further, the adopting release provides notice regarding the

procedures the SEC has established to identify issuers and to impose trading prohibitions on the securities of certain Commission-Identified

Issuers, as required by the HFCAA.

The rules apply to registrants the

SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located in

a foreign jurisdiction and that the PCAOB is unable to inspect or investigate (Commission-Identified Issuers).

The final amendments require

Commission-Identified Issuers to submit documentation to the SEC establishing that, if true, it is not owned or controlled by a governmental

entity in the public accounting firm’s foreign jurisdiction.

The amendments also require that a Commission-Identified Issuer that

is a “foreign issuer,” as defined in Exchange Act Rule 3b-4, provide certain additional disclosures in its annual report for

itself and any of its consolidated foreign operating entities.

Further, the adopting release provides notice regarding the procedures

the SEC has established to identify issuers and to impose trading prohibitions on the securities of certain Commission-Identified Issuers,

as required by the HFCAA.

The SEC will identify Commission-Identified Issuers for fiscal years beginning after Dec.

A Commission-Identified Issuer will be required to comply with the submission and disclosure requirements in the annual report for each

year in which it was identified.

If a registrant is identified as a Commission-Identified Issuer based on its annual report for the fiscal

year ended Dec.

31, 2021, the registrant will be required to comply with the submission or disclosure requirements in its annual report

filing covering the fiscal year ended Dec.

Risks Relating to the Trading Market

A Commission-Identified

Issuer will be required to comply with the submission and disclosure requirements in the annual report for each year in which it was identified.

If a registrant is identified as a Commission-Identified Issuer based on its annual report for the fiscal year ended Dec.

31, 2021, the

registrant will be required to comply with the submission or disclosure requirements in its annual report filing covering the fiscal year

Risks Relating to the our Ordinary Shares

The Warrants we sold in a Private Placement

1 unchanged sentence

expensive to raise capital in the future.

In a November 5, 2020, private placement, we sold

warrants to purchase 869,565 Ordinary Shares at an exercise price of $4.60 per Ordinary Share.

Each warrant will expire five years from

the date of issuance.

The warrant exercise price may be subject to adjustment in the event that we issue certain securities at prices

below the then exercise price.

In connection with our reverse stock split, the exercise price for these warrants were repriced at $2.74

per ordinary share.

Until these warrants all exercised, these repricing exercise features may have the effect of limiting our ordinary

share price and make it more expensive to raise capital in the future.

As of July 31, 2022, 563,855 warrants have been exercised for 459,986

Ordinary Shares, among which 389,855 warrants were exercised at $2.74 per ordinary share for an aggregate total of $1.1 million, and the

remaining 174,000 warrants were cashless exercises.

a November 5, 2020, private placement, we sold warrants to purchase 869,565 Ordinary Shares at an exercise price of $4.60 per Ordinary

Each warrant will expire five years from the date of issuance.

The warrant exercise price may be subject to adjustment in the event

that we issue certain securities at prices below the then exercise price.

In connection with our reverse stock split, the exercise price

for these warrants were repriced at $2.74 per ordinary share.

Until these warrants all exercised, these repricing exercise features may

have the effect of limiting our ordinary share price and make it more expensive to raise capital in the future.

As of July 31, 2023, 563,855

warrants have been exercised for 459,986 Ordinary Shares, among which 389,855 warrants were exercised at $2.74 per ordinary share for

an aggregate total of $1.1 million, and the remaining 174,000 warrants were cashless exercises.

Sales of a significant number of our Ordinary

9 unchanged sentences

Our largest shareholder owns approximately

54.7% of our Ordinary Shares, which will allow him the ability to elect directors and approve matters requiring shareholder approval

by way of resolution of members.

Jun Liu, who is our President, Chief Executive

Officer and Chairman of the Board, is currently the beneficial owner of 5,268,330 ordinary shares (as adjusted to reflect the Reverse

Split), or 54.7% of our current outstanding Ordinary Shares (36.0% directly held by Tianzhen Investments Limited, an entity 100% owned

54.7% of our Ordinary Shares, which will allow him the ability to elect directors and approve matters requiring shareholder approval by

way of resolution of members.

Jun Liu, who is our President, Chief Executive Officer and Chairman of the Board, is currently the beneficial owner of 5,268,330 ordinary

shares (as adjusted to reflect the Reverse Split), or 54.7% of our current outstanding Ordinary Shares (36.0% directly held by Tianzhen

Investments Limited, an entity 100% owned by Mr.

Liu, and the remaining 19.0% that may be deemed to be beneficially owned by Mr.

Liu through the assignment of a proxy agreement

entered with Eno Group Limited on September 30, 2018 to Tianzhen Investments Limited on February 10, 2021).

Liu has the power

to elect all directors and approve all matters requiring shareholder approval without the votes of any other shareholder, significant

influence over a decision to enter into any corporate transaction, and the ability to prevent any transaction that requires the approval

of shareholders, regardless of whether or not our directors or other shareholders believe that such a transaction is in our best interests.

Such concentration of voting power could have the effect of delaying, deterring, or preventing a change of control or other business

combination, which could, in turn, have an adverse effect on the market price of our Ordinary Shares or prevent our shareholders from

realizing a premium over the then-prevailing market price for their Ordinary Shares.

the assignment of a proxy agreement entered with Eno Group Limited on September 30, 2018 to Tianzhen Investments Limited on February

Liu has the power to elect all directors and approve all matters requiring shareholder approval without the votes of any other shareholder,

significant influence over a decision to enter into any corporate transaction, and the ability to prevent any transaction that requires

the approval of shareholders, regardless of whether or not our directors or other shareholders believe that such a transaction is in our

best interests.

Such concentration of voting power could have the effect of delaying, deterring, or preventing a change of control or

other business combination, which could, in turn, have an adverse effect on the market price of our Ordinary Shares or prevent our shareholders

from realizing a premium over the then-prevailing market price for their Ordinary Shares.

Since we are deemed a “controlled

20 unchanged sentences

As a result, you may only receive a return on your investment in our Ordinary Shares if the market price of our Ordinary Shares increases.

If we fail to

maintain an effective system of internal controls over financial reporting, we may not be able to accurately report our financial results

or prevent fraud.

We are subject to reporting

obligations under the U.S.

If we fail to maintain an effective system

of internal controls over financial reporting, we may not be able to accurately report our financial results or prevent fraud.

are subject to reporting obligations under the U.S.

securities laws.

The Securities and Exchange Commission, or the SEC, as required by Section 404 of the

Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, adopted rules requiring every public company to include a management report

on such company’s internal controls over financial reporting in its annual report, which contains management’s assessment

of the effectiveness of the company’s internal controls over financial reporting.

As we are an “emerging growth company,”

we are expected to first include a management report on our internal controls over financial reporting in our annual report in the second

fiscal year end following the effectiveness of our IPO.

As such, these requirements applied to our annual report on Form 20-F for

the fiscal year ending on July 31, 2021.

Our management may conclude that our internal controls over our financial reporting are

not effective.

Moreover, even if our management concludes that our internal controls over financial reporting are effective, our independent

registered public accounting firm may still decline to attest to our management’s assessment or may issue a report that is qualified

if it is not satisfied with our internal controls or the level at which our controls are documented, designed, operated or reviewed,

or if it interprets the relevant requirements differently from us.

Our reporting obligations as a public company will place a significant

strain on our management, operational and financial resources and systems for the foreseeable future.

Prior to our IPO, we

were a private company with limited accounting personnel and other resources with which to address our internal controls and procedures.

We plan to remedy our material weaknesses and other control deficiencies in time to meet the deadline imposed by Section 404 of

the Sarbanes-Oxley Act.

If we fail to timely achieve or maintain the adequacy of our internal controls, we may not be able to conclude

that we have effective internal controls over financial reporting.

Moreover, effective internal controls over financial reporting are

necessary for us to produce reliable financial reports and are important to help prevent fraud.

As a result, our failure to achieve and

maintain effective internal controls over financial reporting could result in the loss of investor confidence in the reliability of our

financial statements, which in turn could harm our business and negatively impact the trading price of our Ordinary Shares.

we anticipate that we will incur considerable costs and devote significant management time and efforts and other resources to comply

with Section 404 of the Sarbanes-Oxley Act.

The Securities and Exchange Commission, or the SEC, as required by

Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, adopted rules requiring every public company to include

a management report on such company’s internal controls over financial reporting in its annual report, which contains management’s

assessment of the effectiveness of the company’s internal controls over financial reporting.

As we are an “emerging growth

company,” we are expected to first include a management report on our internal controls over financial reporting in our annual report

in the second fiscal year end following the effectiveness of our IPO.

As such, these requirements applied to our annual report on Form 10-K

for the fiscal year ending on July 31, 2023.

Our management may conclude that our internal controls over our financial reporting

are not effective.

Moreover, even if our management concludes that

our internal controls over financial reporting are effective, our independent registered public accounting firm may still decline to attest

to our management’s assessment or may issue a report that is qualified if it is not satisfied with our internal controls or the

level at which our controls are documented, designed, operated or reviewed, or if it interprets the relevant requirements differently

Our reporting obligations as a public company will place a significant strain on our management, operational and financial resources

and systems for the foreseeable future.

Prior to our IPO, we were a private company with

limited accounting personnel and other resources with which to address our internal controls and procedures.

We plan to remedy our material

weaknesses and other control deficiencies in time to meet the deadline imposed by Section 404 of the Sarbanes-Oxley Act.

to timely achieve or maintain the adequacy of our internal controls, we may not be able to conclude that we have effective internal controls

over financial reporting.

Moreover, effective internal controls over financial reporting are necessary for us to produce reliable financial

reports and are important to help prevent fraud.

As a result, our failure to achieve and maintain effective internal controls over financial

reporting could result in the loss of investor confidence in the reliability of our financial statements, which in turn could harm our

business and negatively impact the trading price of our Ordinary Shares.

Furthermore, we anticipate that we will incur considerable costs

and devote significant management time and efforts and other resources to comply with Section 404 of the Sarbanes-Oxley Act.

If securities or industry analysts do not

3 unchanged sentences

depend in part on the research and reports that industry or securities analysts publish about us or our business.

We do not have any

control over these analysts.

If one or more of the analysts who cover us downgrade us, the price of our Ordinary Shares would likely

If one or more of these analysts cease coverage of our company or fail to regularly publish reports on us, we could lose visibility

in the financial markets, which could cause the price of our Ordinary Shares and the trading volume to decline.

We do not have any control

over these analysts.

If one or more of the analysts who cover us downgrade us, the price of our Ordinary Shares would likely decline.

If one or more of these analysts cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in

the financial markets, which could cause the price of our Ordinary Shares and the trading volume to decline.

The market price of our Ordinary Shares

2 unchanged sentences

significantly in response to numerous factors, many of which are beyond our control, including:

actual or anticipated fluctuations

in our revenue and other operating results;

the financial projections

we may provide to the public, any changes in these projections or our failure to meet these projections;

actions of securities analysts

who initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow our company, or our

failure to meet these estimates or the expectations of investors;

announcements by us or

our competitors of significant products or features, technical innovations, acquisitions, strategic partnerships, joint ventures,

or capital commitments;

price and volume fluctuations

in the overall stock market, including as a result of trends in the economy as a whole;

lawsuits threatened or

filed against us;

other events or factors,

including those resulting from war or incidents of terrorism, or responses to these events.

actual or anticipated fluctuations in our revenue and other operating results;

the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections;

actions of securities analysts who initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow our company, or our failure to meet these estimates or the expectations of investors;

announcements by us or our competitors of significant products or features, technical innovations, acquisitions, strategic partnerships, joint ventures, or capital commitments;

price and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole;

lawsuits threatened or filed against us;

other events or factors, including those resulting from war or incidents of terrorism, or responses to these events.

In addition, the stock markets have experienced

2 unchanged sentences

In the past, stockholders have filed securities class action litigation following periods of market volatility.

If we were to become

involved in securities litigation, it could subject us to substantial costs, divert resources and the attention of management from our

business, and adversely affect our business.

If we were to become involved

in securities litigation, it could subject us to substantial costs, divert resources and the attention of management from our business,

and adversely affect our business.

Because we are an “emerging growth

9 unchanged sentences

devote substantial management effort toward ensuring compliance increased disclosure requirements.

Because we have ceased to qualify as a

foreign private issuer, we are required to comply fully with the reporting requirements of the Exchange Act applicable to U.S.

issuers, and we will incur significant additional legal, accounting, and other expenses that we would not incur as a foreign private

Because we have ceased to qualify as a foreign

private issuer, we are required to comply fully with the reporting requirements of the Exchange Act applicable to U.S.

domestic issuers,

and we will incur significant additional legal, accounting, and other expenses that we would not incur as a foreign private issuer.

Because we are no longer a foreign private issuer,

15 unchanged sentences

We intend to conduct our operations so that we will not be deemed an investment company.

However, if we were to be deemed an investment company, restrictions imposed by the 1940 Act, including limitations on our capital structure

and our ability to transact with affiliates, could make it impractical for us to continue our business as contemplated and would have

a material adverse effect on our business and the price of our Ordinary Shares.

if we were to be deemed an investment company, restrictions imposed by the 1940 Act, including limitations on our capital structure and

our ability to transact with affiliates, could make it impractical for us to continue our business as contemplated and would have a material

adverse effect on our business and the price of our Ordinary Shares.

Anti-takeover provisions in our amended

3 unchanged sentences

consider favorable, including, among other things, the following:

provisions that permit

our board of directors by resolution to amend certain provisions of the memorandum and articles of association, including to create

and issue classes of shares with preferred, deferred or other special rights or restrictions as the board of directors determine

in their discretion, without any further vote or action by our shareholders.

If issued, the rights, preferences, designations, and

limitations of any class of preferred shares would be set by the board of directors by way of amendments to relevant provisions of

the memorandum and articles of association and could operate to the disadvantage of the outstanding ordinary shares the holders of

which would not have any pre-emption rights in respect of such an issue of preferred shares.

Such terms could include, among others,

preferences as to dividends and distributions on liquidation, or could be used to prevent possible corporate takeovers;

provisions that restrict

the ability of our shareholders holding in aggregate less than thirty percent (30%) of the outstanding voting shares in the company

to call meetings and to include matters for consideration at shareholder meetings.

provisions that permit our board of directors by resolution to amend certain provisions of the memorandum and articles of association, including to create and issue classes of shares with preferred, deferred or other special rights or restrictions as the board of directors determine in their discretion, without any further vote or action by our shareholders.

If issued, the rights, preferences, designations, and limitations of any class of preferred shares would be set by the board of directors by way of amendments to relevant provisions of the memorandum and articles of association and could operate to the disadvantage of the outstanding ordinary shares the holders of which would not have any pre-emption rights in respect of such an issue of preferred shares.

Such terms could include, among others, preferences as to dividends and distributions on liquidation, or could be used to prevent possible corporate takeovers;

provisions that restrict the ability of our shareholders holding in aggregate less than thirty percent (30%) of the outstanding voting shares in the company to call meetings and to include matters for consideration at shareholder meetings.

Because we are a BVI company, you may be

6 unchanged sentences

Even if you are successful in bringing

an action of this kind, the laws of the BVI may not permit you to enforce a judgment against our assets outside of the United States

or the assets of our directors and officers.

an action of this kind, the laws of the BVI may not permit you to enforce a judgment against our assets outside of the United States or

the assets of our directors and officers.

Our board of directors may decline to register

1 unchanged sentence

Our board of directors may, in its sole discretion,

decline to register any transfer of any Ordinary Share issued in certificated form, which is not fully paid up or on which we have a

Our directors may also decline to register any transfer of any share issued in certificated form in the case of a transfer

to joint holders, the number of joint holders to whom the share is to be transferred does not exceed four.

A shareholder wishing to transfer

its Ordinary Shares is liable to pay to the Company a fee of such maximum sum as Nasdaq Capital Market may determine to be payable,

or such lesser sum as our board of directors may from time to time require in respect thereof.

decline to register any transfer of any Ordinary Share issued in certificated form, which is not fully paid up or on which we have a lien.

Our directors may also decline to register any transfer of any share issued in certificated form in the case of a transfer to joint

holders, the number of joint holders to whom the share is to be transferred does not exceed four.

A shareholder wishing to transfer its

Ordinary Shares is liable to pay to the Company a fee of such maximum sum as Nasdaq Capital Market may determine to be payable, or

such lesser sum as our board of directors may from time to time require in respect thereof.

If our directors refuse to register a transfer

1 unchanged sentence

notice of such refusal.

The registration of transfers may, on 14 days’ notice being given by advertisement in such one or more

newspapers or by electronic means, be suspended and the register closed at such times and for such periods as our board of directors

may from time to time determine, provided, however, that the registration of transfers shall not be suspended nor the register closed

for more than 30 days in any year.

The registration of transfers may, on 14 days’ notice being given by advertisement in such one or more newspapers

or by electronic means, be suspended and the register closed at such times and for such periods as our board of directors may from time

to time determine, provided, however, that the registration of transfers shall not be suspended nor the register closed for more than

30 days in any year.

Certain types of class or derivative actions

15 unchanged sentences

also unlikely to recognize or enforce against us judgments of courts in the United States based on certain liability provisions of U.S.

securities law or to impose liabilities against us, in original actions brought in the BVI, based on certain liability provisions of

securities law or to impose liabilities against us, in original actions brought in the BVI, based on certain liability provisions of U.S.

securities laws that are penal in nature.

There is no statutory recognition in the BVI

of judgments obtained in the United States, although the courts of the BVI will in certain circumstances recognize such a foreign judgment

and treat it as a cause of action in itself which may be sued upon as a debt at common law so that no retrial of the issues would be

necessary provided that:

court issuing

the judgment had jurisdiction in the matter and the company either submitted to such jurisdiction or was resident or carrying on

business within such jurisdiction and was duly served with process;

There is no statutory recognition in the BVI of

judgments obtained in the United States, although the courts of the BVI will in certain circumstances recognize such a foreign judgment

and treat it as a cause of action in itself which may be sued upon as a debt at common law so that no retrial of the issues would be necessary

provided that:

court issuing the judgment had jurisdiction in the matter and the company either submitted to such jurisdiction or was resident or carrying on business within such jurisdiction and was duly served with process;

is final and for a liquidated sum;

the judgment given by the

the judgment given by the U.S.

court was not in respect of penalties, taxes, fines or similar fiscal or revenue obligations of the company;

in obtaining judgment there

was no fraud on the part of the person in whose favor judgment was given or on the part of the court;

recognition or enforcement

of the judgment would not be contrary to public policy in the BVI;

the proceedings pursuant

to which judgment was obtained were not contrary to natural justice.

in obtaining judgment there was no fraud on the part of the person in whose favor judgment was given or on the part of the court;

recognition or enforcement of the judgment would not be contrary to public policy in the BVI;

the proceedings pursuant to which judgment was obtained were not contrary to natural justice.

In appropriate circumstances, a BVI Court may

1 unchanged sentence

of contracts and injunctions.

Recent statements by the SEC on the PRC’s

guidance and restrictions on China-based companies seeking to raise capital in the United States may raise scrutiny as to our operations

and SEC disclosures.

In light of the PRC providing new guidance to

and restrictions on China-based companies raising capital offshore, including PRC government-led cybersecurity reviews, the Chairman

of the SEC has requested his staff to review disclosures from offshore issuers associated with China-based operating companies in connection

with the filing of registration statements in the United States.

In particular, the SEC Chairman was concerned about an investor’s

understanding of a VIE contract structure.

We previously conducted our going public related consulting service business through Qianhai

utilizing a VIE contract structure which relationship was terminated in February 2021.

In connection with our internal reorganization

in January and February 2021, we terminated the Qianhai VIE agreements.

The termination of the Qianhai VIE agreements did not discontinue

our public listing related consulting service business, because such consulting service business has been transferred to Huaya to serve

the client located in China and to ATIF Inc.

to serve the clients located within the United States.

Currently, we plan to use Huaya,

a wholly owned subsidiary of ATIF, to continue to provide consulting services to our clients located in the PRC, and we do not plan to

use variable interest entities to execute our business plan and to conduct our China-based operations in the near term.

However, since

we have business operations in China, there is always a risk that the Chinese government may in the future seek to intervene or influence

operations of any company with any level of operations in China, including its ability to offer securities to investors, list its securities

or other foreign exchange, conduct its business or accept foreign investment.

If we conduct business in the PRC in the future

with a PRC entity using a VIE contract structure, that business structure may subject us to further review by the SEC.

You may have more difficulty protecting

3 unchanged sentences

from time to time (the “BVI Act”) and the common law of the BVI.

The rights of shareholders and the statutory duties and

fiduciary responsibilities of our directors and officers under BVI law may not be clearly established as they would be under statutes

or judicial precedents in some jurisdictions in the United States, and some states (such as Delaware) have more fully developed and judicially

interpreted bodies of corporate law.

The rights of shareholders and the statutory duties and fiduciary

responsibilities of our directors and officers under BVI law may not be clearly established as they would be under statutes or judicial

precedents in some jurisdictions in the United States, and some states (such as Delaware) have more fully developed and judicially interpreted

bodies of corporate law.

These rights and responsibilities are governed

by our amended and restated memorandum and articles of association, the BVI Act and the common law of the BVI.

The common law of the

BVI is derived in part from judicial precedent in the BVI as well as from English common law, which has persuasive, but not binding,

authority on a court in the BVI.

In addition, BVI law does not make a distinction between public and private companies and some of the

protections and safeguards (such as statutory pre-emption rights, save to the extent expressly provided for in the amended and restated

memorandum and articles of association) that investors may expect to find in relation to a public company are not provided for under

The common law of the BVI

is derived in part from judicial precedent in the BVI as well as from English common law, which has persuasive, but not binding, authority

on a court in the BVI.

In addition, BVI law does not make a distinction between public and private companies and some of the protections

and safeguards (such as statutory pre-emption rights, save to the extent expressly provided for in the amended and restated memorandum

and articles of association) that investors may expect to find in relation to a public company are not provided for under BVI law.

There may be less publicly available information

7 unchanged sentences

The laws of BVI provide limited protections

for minority shareholders, so minority shareholders will not have the same options as to recourse in comparison to the United States

if the shareholders are dissatisfied with the conduct of our affairs.

for minority shareholders, so minority shareholders will not have the same options as to recourse in comparison to the United States if

the shareholders are dissatisfied with the conduct of our affairs.

Under the laws of the BVI there is limited statutory

3 unchanged sentences

and unfair discrimination and/or to enforce the BVI Act or the amended and restated memorandum and articles of association.

are entitled to have the affairs of the company conducted in accordance with the BVI Act and the amended and restated memorandum and

articles of association, and are entitled to payment of the fair value of their respective shares upon dissenting from certain enumerated

corporate transactions.

The common law of the BVI is derived in part

from judicial precedent in the BVI as well as from English common law, which has persuasive, but not binding, authority on a court in

There are common law rights for the protection of shareholders that may be invoked, largely dependent on English company law,

since the common law of the BVI is less extensive than that of England.

Under the general rule pursuant to English company law known

as the rule in Foss v.

Harbottle, a court will generally refuse to interfere with the management of a company at the insistence

of a minority of its shareholders who express dissatisfaction with the conduct of the company’s affairs by the majority or the

board of directors.

However, every shareholder is entitled to seek to have the affairs of the company conducted properly according to

law and the constitutional documents of the company.

As such, if those who control the company have persistently disregarded the requirements

of company law or the provisions of the company’s memorandum and articles of association, then the courts may grant relief.

the areas in which the courts will intervene are the following:

(i) a company is acting or proposing to act illegally or beyond

the scope of its authority;

(ii) the act complained of, although not beyond the scope of the authority, could only be effected if

duly authorized by more than the number of votes which have actually been obtained;

(iii) the individual rights of the plaintiff

shareholder have been infringed or are about to be infringed;

or (iv) those who control the company are perpetrating a “fraud

on the minority.”

are entitled to have the affairs of the company conducted in accordance with the BVI Act and the amended and restated memorandum and articles

of association, and are entitled to payment of the fair value of their respective shares upon dissenting from certain enumerated corporate

transactions.

The common law of the BVI is derived in part from

judicial precedent in the BVI as well as from English common law, which has persuasive, but not binding, authority on a court in the BVI.

There are common law rights for the protection of shareholders that may be invoked, largely dependent on English company law, since the

common law of the BVI is less extensive than that of England.

Under the general rule pursuant to English company law known as the

rule in Foss v.

Harbottle, a court will generally refuse to interfere with the management of a company at the insistence of a minority

of its shareholders who express dissatisfaction with the conduct of the company’s affairs by the majority or the board of directors.

However, every shareholder is entitled to seek to have the affairs of the company conducted properly according to law and the constitutional

documents of the company.

As such, if those who control the company have persistently disregarded the requirements of company law or the

provisions of the company’s memorandum and articles of association, then the courts may grant relief.

Generally, the areas in which

the courts will intervene are the following:

(i) a company is acting or proposing to act illegally or beyond the scope of its authority;

(ii) the act complained of, although not beyond the scope of the authority, could only be effected if duly authorized by more than

the number of votes which have actually been obtained;

(iii) the individual rights of the plaintiff shareholder have been infringed

or are about to be infringed;

or (iv) those who control the company are perpetrating a “fraud on the minority.”

These rights may be more limited than the rights

11 unchanged sentences

be classified as a passive foreign investment company, which is known as a PFIC, for any taxable year if, for such year, either

At least 75% of our gross

income for the year is passive income;

The average percentage

of our assets (determined at the end of each quarter) during the taxable year which produce passive income or which are held for

the production of passive income is at least 50%.

Passive income generally includes dividends,

interest, rents and royalties (other than rents or royalties derived from the active conduct of a trade or business), and gains from

the disposition of passive assets.

At least 75% of our gross income for the year is passive income;

The average percentage of our assets (determined at the end of each quarter) during the taxable year which produce passive income or which are held for the production of passive income is at least 50%.

Passive income generally includes dividends, interest,

rents and royalties (other than rents or royalties derived from the active conduct of a trade or business), and gains from the disposition

of passive assets.

If we are determined to be a PFIC for any taxable

1 unchanged sentence

taxpayer who holds our ordinary shares, the U.S.

may be subject to increased U.S.

be subject to increased U.S.

federal income tax liability and may be subject to additional reporting requirements.

Depending on the amount of assets held for the

production of passive income, it is possible that, for our 2022 taxable year or for any subsequent year, more than 50% of our assets

may be assets which produce passive income.

production of passive income, it is possible that, for our 2022 taxable year or for any subsequent year, more than 50% of our assets may

be assets which produce passive income.

We will make this determination following the end of any particular tax year.

of the PFIC analysis, in general, according to Internal Revenue Code Section 1297(c), a non-U.S.

corporation is deemed to own its

pro rata share of the gross income and assets of any entity in which it is considered to own at least 25% of the stock by value.

For purposes of

the PFIC analysis, in general, according to Internal Revenue Code Section 1297(c), a non-U.S.

corporation is deemed to own its pro

rata share of the gross income and assets of any entity in which it is considered to own at least 25% of the stock by value.

Volatility in the market price of our

ordinary shares could lead to losses by investors.

The market price of our ordinary

shares has experienced volatility in the past and may experience volatility in the future which could lead to losses for investors.

impacting volatility in the market price of our ordinary shares include, amongst others:

● general market and economic conditions;

● our results of operations;

● issuance of new or changed securities analysts’

reports or recommendations;

● developments impacting the industry or our competitors;

● declines in the market prices of stocks generally;

● strategic actions by us or our competitors;

● announcements by us or our competitors of significant

contracts, new products, acquisitions, joint marketing relationships, joint ventures, other strategic relationships or capital commitments;

● the public’s reaction to press releases, other public announcements by us

or third parties, including our filings with the SEC;

● guidance, if any, that we provide to the public,

any changes in this guidance or failure to meet this guidance;

● changes in the credit rating of our debt;

● sale, or anticipated sale, of large blocks of

● additions or departures of key personnel;

● regulatory or political developments;

● our performance on ESG matters

● litigation and governmental investigations;

● changing economic conditions;

● exchange rate fluctuations;

● changes in accounting principles;

● other events or factors, including those resulting

from natural disasters, war, acts of terrorism or responses to those events.

In addition, stock markets

have from time to time experienced significant price and volume fluctuations unrelated to the operating performance of particular companies.

Future fluctuations in stock markets may lead to volatility in the market price of our ordinary shares which could lead to losses by investors.

UNRESOLVED STAFF COMMENTS

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors