Hezong Science & Technology and related parties received an advance notice of administrative penalties from the Beijing Securities Regulatory Bureau

According to the Zhitong Finance APP, Hezong Science & Technology (300477.SZ) announced that the company and relevant parties received the "Notice of Administrative Penalty Pre-Disclosure" issued by the Beijing Regulatory Bureau of the China Securities Regulatory Commission. The facts of the alleged violations by Hezong Science & Technology are as follows: In 2022, Liu Zegang served as the chairman of Hezong Science & Technology and concurrently held the position of chairman of Tianjin Maolian Technology Co., Ltd. (referred to as Tianjin Maolian), and was the executive director of Zhejiang Yinglian Technology Co., Ltd. (referred to as Zhejiang Yinglian) and Tianjin Shenglian International Trade Co., Ltd. (referred to as Tianjin Shenglian). Zhejiang Yinglian and Tianjin Shenglian are wholly-owned subsidiaries of Tianjin Maolian. Tianjin Maolian, Zhejiang Yinglian, and Tianjin Shenglian are related legal entities of Hezong Science & Technology. Hezong Science & Technology's wholly-owned subsidiaries, Beijing Hezong Shike Electric Power Technology Co., Ltd. and Tianjin Hezong Electric Power Equipment Co., Ltd., provided financial assistance to Tianjin Maolian, Zhejiang Yinglian, and Tianjin Shenglian through Beijing Huahuan Lida Technology Co., Ltd. and Tianjin Yongtai Junan Technology Co., Ltd., constituting non-operating fund occupation by related parties, with a total of 508 million yuan provided in 2022, accounting for 21.78% and 17.01% of Hezong Science & Technology's most recent audited net assets and the net assets disclosed for the current period, respectively. As of December 31, 2022, Hezong Science & Technology had recovered the aforementioned funds. Hezong Science & Technology failed to disclose related party transactions in a timely manner, allegedly violating the provisions of Article 78, Paragraph 1 of the Securities Law, constituting the illegal behavior described in Article 197, Paragraph 1 of the Securities Law. The annual report for 2022 disclosed by Hezong Science & Technology contained significant omissions, allegedly violating the provisions of Article 78, Paragraph 2 of the Securities Law, constituting the illegal behavior described in Article 197, Paragraph 2 of the Securities Law. The Beijing Regulatory Bureau intends to decide: to order Hezong Science & Technology Co., Ltd. to make corrections, issue a warning, and impose a fine of 4 million yuan; to issue a warning to Wei Qiang and impose a fine of 1.5 million yuan; to issue a warning to Zhang Xiaoyi and impose a fine of 1 million yuan