United States securities and exchange commission logo
May 24, 2023
Ban Siong Ang
Chief Executive Officer
Heyu Biological Technology Corp
Room 1901, Baotuo Building, 617 Sishui Street
Huli District, Xiamen City,
Fujian Province, China 361009
Re: Heyu Biological
Technology Corp
Form 10-K for the
Fiscal Year Ended December 31, 2022
Filed March 23,
2023
File No. 000-26731
Dear Ban Siong Ang:
We have reviewed your filing and have the following comments. In
some of our
comments, we may ask you to provide us with information so we may better
understand your
disclosure.
Please respond to these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to these comments, we may have additional comments.
Form 10-K for the Fiscal Year Ended December 31, 2022
Item 1. Business, page 1
1. At the outset of Part
I, please prominently disclose that you are not a Chinese operating
company but a Nevada
holding company with operations conducted by your subsidiaries.
2. Provide prominent
disclosure about the legal and operational risks associated with being
based in or having the
majority of the company s operations in China. Your disclosure
should make clear
whether these risks could result in a material change in your operations
and/or the value of
your securities or could significantly limit or completely hinder your
ability to offer or
continue to offer securities to investors and cause the value of such
securities to
significantly decline or be worthless. Your disclosure should address how
recent statements and
regulatory actions by China s government, such as those related to
the use of variable
interest entities and data security or anti-monopoly concerns, have or
Ban Siong Ang
FirstName LastNameBan Siong Ang
Heyu Biological Technology Corp
Comapany
May NameHeyu Biological Technology Corp
24, 2023
May 24,
Page 2 2023 Page 2
FirstName LastName
may impact the company s ability to conduct its business, accept
foreign investments, or
list on a U.S. or other foreign exchange. Please prominently disclose
whether your auditor
is subject to the determinations announced by the PCAOB on December
16, 2021 and
whether and how the Holding Foreign Companies Accountable Act and
related
regulations will affect your company. In addition, disclose that
trading in your securities
may be prohibited under the Holding Foreign Companies Accountable Act
if the PCAOB
determines that it cannot inspect or investigate completely your
auditor, and that as a
result an exchange may determine to delist your securities. 7
3. Clearly disclose how you will refer to the holding company and
subsidiaries when
providing disclosure throughout the document so that it is clear to
investors which entity
the disclosure is referencing and which subsidiaries or entities are
conducting the business
operations.
4. Provide a clear description of how cash is transferred through your
organization. Disclose
your intentions to distribute earnings. Quantify any cash flows and
transfers of other
assets by type that have occurred between the holding company and its
subsidiaries, and
the direction of transfer. Quantify any dividends or distributions
that a subsidiary
has made to the holding company and which entity made such transfer,
and their tax
consequences. Similarly quantify dividends or distributions made to
U.S. investors, the
source, and their tax consequences. Your disclosure should make clear
if no transfers,
dividends, or distributions have been made to date. Describe any
restrictions on foreign
exchange and your ability to transfer cash between entities, across
borders, and to U.S.
investors. Describe any restrictions and limitations on your ability
to distribute earnings
from the company, including your subsidiaries, to the parent company
and U.S. investors.
Additionally, disclose if you have specific cash management policies
that dictate how
funds are transferred through your organization and if applicable,
describe such policies
and procedures.
5. Disclose each permission or approval that you or your subsidiaries are
required to obtain
from Chinese authorities to operate your business and to offer
securities to foreign
investors. State whether you or your subsidiaries are covered by
permissions
requirements from the China Securities Regulatory Commission (CSRC),
Cyberspace
Administration of China (CAC) and state affirmatively whether you have
received all
requisite permissions or approvals and whether any permissions or
approvals have been
denied. Please also describe the consequences to you and your
investors if you or your
subsidiaries: (i) do not receive or maintain such permissions or
approvals, (ii)
inadvertently conclude that such permissions or approvals are not
required, or (iii)
applicable laws, regulations, or interpretations change and you are
required to obtain such
permissions or approvals in the future.
Corporate Structure, page 4
6. For each of your subsidiaries in your organizational chart, please
clearly depict where
each subsidiary is incorporated. In addition, to the extent that any
of the subsidiaries in
Ban Siong Ang
FirstName LastNameBan Siong Ang
Heyu Biological Technology Corp
Comapany
May NameHeyu Biological Technology Corp
24, 2023
May 24,
Page 3 2023 Page 3
FirstName LastName
the organizational chart are not wholly-owned by you, please also
update your disclosure
to state this clearly and disclose the other owners.
7. We note the inclusion of a chart detailing your corporate structure.
Please clarify if your
corporate structure includes any variable interest entities or VIEs.
To the extent your
corporate structure does not contain any variable interest entities,
please include an
affirmative statement to that effect.
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Results of Operations, page 11
8. Please revise to address the following:
Revise to explain in more detail how you generated the revenue you
reported and
why there is no inventory reported as of the balance sheet date.
We note the disclosure on page F-15 and elsewhere in the filing
that revenues are
identified as related party. Please revise to clarify the related
party relationship.
Explain why revenues are not identified as related party on the
face of your Statement
of Operations in your Form10-Q for the quarterly period ended
March 31, 2023.
Revise your MD&A to disclose your policies for revenue
recognition. Specifically
clarify when you expect to recognize the customer prepayments for
your new medical
products and services as revenue.
9. Revise to address the following:
Please quantify each of the factors you noted for the increase in
expenses.
Please correct the table as the $27,385 disclosed as Total
operating expenses is shown
as Cost of revenue on your statement of operations. Break out your
Cost of revenue
separately, and discuss the changes accordingly.
At various locations in your document you discuss your research
and development
activities. Revise to discuss the extent to which such activities
meet the criteria for
reporting such amounts as research and development expenses under
ASC 730, and
provide separate quantification of your research and development
expenses here as
well as on the face of your statement of operations.
Notes to Consolidated Financial Statements
Note 1 - The Company and Significant Accounting Policies, page F-7
10. Please expand your footnotes to discuss your accounting policies for
the following areas:
Revenue Recognition
Cost of Revenue
Advances from Customers
General
11. Disclose the risks that your corporate structure and being based in or
having the majority
of the company s operations in China poses to investors. In
particular, describe the
significant regulatory, liquidity, and enforcement risks with
cross-references to the more
Ban Siong Ang
Heyu Biological Technology Corp
May 24, 2023
Page 4
detailed discussion of these risks in the annual report. For example,
specifically discuss
risks arising from the legal system in China, including risks and
uncertainties regarding
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
your operations at any time, or may exert more control over offerings
conducted overseas
and/or foreign investment in China-based issuers, which could result
in a material change
in your operations and/or the value of the securities you are
registering for sale.
Acknowledge any risks that any actions by the Chinese government to
exert more
oversight and control over offerings that are conducted overseas
and/or foreign investment
in China-based issuers could significantly limit or completely hinder
your ability to offer
or continue to offer securities to investors and cause the value of
such securities to
significantly decline or be worthless.
12. Given the Chinese government s significant oversight and discretion
over the conduct of
your business, please revise to highlight separately the risk that the
Chinese government
may intervene or influence your operations at any time, which could
result in a material
change in your operations and/or the value of the securities you are
registering. Also,
given recent statements by the Chinese government indicating an intent
to exert more
oversight and control over offerings that are conducted overseas
and/or foreign investment
in China-based issuers, acknowledge the risk that any such action
could significantly limit
or completely hinder your ability to offer or continue to offer
securities to investors and
cause the value of such securities to significantly decline or be
worthless.
13. In light of recent events indicating greater oversight by the
Cyberspace Administration of
China (CAC) over data security, particularly for companies seeking to
list on a foreign
exchange, please revise your disclosure to explain how this oversight
impacts your
business and to what extent you believe that you are compliant with
the regulations or
policies that have been issued by the CAC to date.
We remind you that the company and its management are responsible for
the accuracy
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
You may contact Vanessa Robertson at 202-551-3649 or Kevin Vaughn at
202-551-3494
if you have questions regarding comments on the financial statements and
related
matters. Please contact Tyler Howes at 202-551-3370 or Jason Drory at
202-551-8342 with any
other questions.
FirstName LastNameBan Siong Ang Sincerely,
Comapany NameHeyu Biological Technology Corp
Division of
Corporation Finance
May 24, 2023 Page 4 Office of Life
Sciences
FirstName LastName