Securities code: Zhejiang Busen Garments Co.Ltd(002569) securities abbreviation: St BUSEN Announcement No.: 2022012
Zhejiang Busen Garments Co.Ltd(002569)
The company and relevant parties have received the notice from Zhejiang regulatory bureau of China Securities Regulatory Commission
Announcement of advance notice of administrative punishment
The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete without false records, misleading statements or major omissions.
1、 Basic information
Zhejiang Busen Garments Co.Ltd(002569) (hereinafter referred to as “the company”) received the notice of China Securities Regulatory Commission on filing a case (Zheng Jian Li Jian Li Jian Zi No. 01120201013) on December 3, 2021. Because the company is suspected of violating laws and regulations in information disclosure, the China Securities Regulatory Commission decided to file a case for investigation in accordance with the securities law of the people’s Republic of China, the administrative punishment law of the people’s Republic of China and other laws and regulations. On December 4, 2021, the company disclosed the announcement on receiving the notice of filing a case from the CSRC (Announcement No.: 2021158) on the designated information disclosure media, and on January 5, 2022, the announcement on the progress of filing an investigation and risk warning (Announcement No.: 2022001) on the designated information disclosure media On January 29, 2022, the announcement on the progress of investigation and risk warning was disclosed on the designated information disclosure media (Announcement No.: 2022005), and on March 3, 2022, the announcement on the progress of investigation and risk warning was disclosed on the designated information disclosure media (Announcement No.: 2022007). During the investigation period, the company actively cooperated with the investigation work of China Securities Regulatory Commission and disclosed the progress of investigation and risk warning announcement once a month in accordance with the stock listing rules of Shenzhen Stock Exchange and other relevant provisions. 2、 Main contents of advance notice of administrative punishment
On April 8, 2022, the company and relevant parties received the notice in advance of administrative punishment (zjz [2022] No. 9) (hereinafter referred to as the “notice”) issued by Zhejiang securities regulatory bureau of China Securities Regulatory Commission, and now announce the relevant contents of the notice as follows:
” Zhejiang Busen Garments Co.Ltd(002569) , Ms. Zhao Chunxia, Mr. Wang Chunjiang, Mr. Du Xin and Mr. Zhang you: Zhejiang Busen Garments Co.Ltd(002569) (hereinafter referred to as BUSEN Co., Ltd.) is suspected of illegal information disclosure, and the illegal facts, reasons, basis and relevant rights you enjoy shall be informed.
After investigation, the facts of BUSEN’s suspected violation of the law are as follows:
1、 The equity transfer fails to fulfill the obligation of information disclosure as required
(I) the disclosure of the equity transfer agreement is incomplete and there are major omissions
On September 10, 2019, BUSEN Co., Ltd. signed the equity transfer agreement with the related party yilianhuihua (Beijing) Technology Co., Ltd. (hereinafter referred to as yilianhuihua), which plans to acquire 60.4% equity of Guangdong Xinhui e-commerce Co., Ltd. (hereinafter referred to as Guangdong Xinhui) held by yilianhuihua with RMB 138316000. Guangdong Xinhui is mainly engaged in third-party payment business and has the payment business license issued by the people’s Bank of China. In connection with this, the equity transfer agreement specifically stipulates that “if the people’s Bank of China does not give a reply of consent or disagreement at the expiration of one year from the date of signing this Agreement (both parties can negotiate to delay the period of one year, or one year if they cannot reach an agreement), or the people’s Bank of China has given a reply of disagreement before the expiration of that year”, the agreement will be automatically terminated. On September 12, BUSEN Co., Ltd. issued the announcement on foreign investment and related party transactions, which only disclosed in the main contents of the transaction agreement that “if the people’s Bank of China approves and rejects the equity transfer, the equity transfer agreement will be automatically terminated”, and did not fully disclose the relevant specific provisions of the agreement. The equity transfer agreement involves both major investment and related party transactions. In accordance with the provisions of paragraphs 1, 2, 2 and 12 of Article 67 of the securities law of the people’s Republic of China (hereinafter referred to as the securities law of 2005), it shall perform the obligation of temporary disclosure. The above terms set in combination with the approval of the people’s Bank of China have agreed on the termination conditions and time limit of the agreement, which has a significant impact on the performance of the agreement and is an important content of the agreement. BUSEN shares did not make a complete disclosure, which violated the provisions of article 63 of the securities law of 2005 and constituted an illegal act of information disclosure described in paragraph 1 of Article 193 of the securities law of 2005.
(II) failure to disclose in time and fail to meet the conditions of major contributors of Payment institutions
Around the end of October 2019, Wang Chunjiang, the then chairman and legal representative, learned that BUSEN shares did not have the qualification to become the main contributor of Guangdong Xinhui, a payment institution, because it did not meet the relevant provisions of payment service management.
Failure to meet the conditions of major investors will have an important impact on the performance progress of the equity transfer agreement and the feasibility of acquisition. According to Article 32 of the measures for the administration of information disclosure of listed companies (hereinafter referred to as the measures for the administration of information disclosure of Listed Companies in 2007), it is a major event specified in item 12, paragraph 2, Article 67 of the securities law of 2005. BUSEN’s failure to disclose the above information in time violates the provisions of Article 63 of the securities law of 2005, and constitutes an illegal act of information disclosure described in paragraph 1 of Article 193 of the securities law of 2005.
(III) failure to disclose the substantial extension of the equity transfer agreement in time
After the expiration of the one-year term, BUSEN shares and yilianhuihua did not reach an extension agreement in writing, but the trading parties continued to promote the equity transfer with practical actions, and the equity transfer agreement was substantially extended.
The substantial extension is an important progress and change of the equity transfer agreement. According to Article 32 of the letter Phi measures in 2007, it is a major event specified in item 12, paragraph 2, Article 80 of the securities law of the people’s Republic of China (hereinafter referred to as the securities law of 2019) revised in 2019. BUSEN’s failure to disclose the above information in time violates the provisions of paragraph 1 of Article 78 of the securities law of 2019, and constitutes an illegal act of information disclosure described in paragraph 1 of article 197 of the securities law of 2019.
2、 Failure to disclose the settlement agreement in time
In April 2019, BUSEN Co., Ltd. and BUSEN Group Co., Ltd. (hereinafter referred to as BUSEN group) signed the equity acquisition agreement to acquire 100% equity of Zhuji BUSEN Investment Co., Ltd. held by BUSEN group for 95.84 million yuan. After the dispute, BUSEN group sued to the court to order BUSEN shares to pay the first equity transfer payment of 30 million yuan and liquidated damages for overdue payment. In August 2021, the court ordered BUSEN to pay the first transfer of 30 million yuan and corresponding interest.
In September 2021, both parties signed the settlement agreement and agreed to terminate the equity acquisition agreement. BUSEN shares did not need to pay the equity transfer amount of 95.84 million yuan as agreed in the agreement, and 8 million yuan of overdue payment interest. On November 20, 2021, BUSEN disclosed the above matters of the settlement agreement in the announcement on the reply to the regulatory inquiry letter of Zhejiang securities regulatory bureau.
The settlement agreement solves the problem of the first equity transfer and interest involved in the lawsuit, which is an important progress of major litigation. At the same time, it also terminates the equity acquisition agreement, which is an important change in major investment. According to the provisions of Article 22, paragraph 2, item 1 and Article 25 of the measures for the administration of information disclosure of listed companies issued in 2021, it is a major event specified in Article 80, paragraph 2, item 12 of the securities law of 2019. BUSEN shares failed to disclose the settlement agreement in time, which violated the provisions of paragraph 1 of Article 78 of the securities law of 2019 and constituted an illegal act of information disclosure described in paragraph 1 of article 197 of the securities law of 2019.
The above illegal facts are proved by the company’s announcement, contract and relevant materials, litigation materials, inquiry records, situation description, information of the board of directors and other relevant evidence.
Zhao Chunxia, then chairman of the board, participated in the signing of the equity transfer agreement and the deliberation of the board of directors. During this period, she acted as the Secretary of the board of directors and was directly responsible for the equity transfer (I).
Wang Chunjiang, then chairman of the board of directors, coordinated the acquisition matters involved in the equity transfer agreement, knew the contents of the equity transfer agreement and relevant progress, and knew that the company signed the settlement agreement after leaving office and actually performed the duties of the chairman during this period. He was the person in charge directly responsible for equity transfer matters (II), equity transfer matters (III) and settlement agreement matters.
Du Xin, acting general manager and vice chairman at that time, knew the contents of the equity transfer agreement and participated in relevant information disclosure. He was the person in charge directly responsible for equity transfer (III).
Zhang you, then Secretary of the board of directors, was specifically responsible for information disclosure, knew the contents of the equity transfer agreement, and was responsible for litigation settlement. He was the person in charge directly responsible for equity transfer (III) and settlement agreement.
According to the facts, nature, circumstances and degree of social harm of the illegal acts of the parties, and in accordance with the provisions of paragraph 1 of Article 193 of the securities law of 2005 and paragraph 1 of article 197 of the securities law of 2019, our bureau intends to decide: 1. Order Zhejiang Busen Garments Co.Ltd(002569) to make corrections, give a warning and impose a fine of 500000 yuan;
2、 Zhao Chunxia was given a warning and fined 50000 yuan;
3、 Wang Chunjiang was given a warning and fined 300000 yuan;
4、 Du Xin and Zhang you were warned and fined 200000 yuan respectively.
In accordance with articles 45, 63 and 64 of the administrative punishment law of the people’s Republic of China and the relevant provisions of the administrative punishment hearing rules of the China Securities Regulatory Commission, you have the right to state, defend and request a hearing on the administrative punishment to be imposed on you by our bureau. If the facts, reasons and evidence you put forward are established after review by our bureau, our bureau will adopt them. If you give up the right of statement, defense and hearing, our bureau will make a formal decision on administrative punishment according to the above facts, reasons and basis.
Please submit the receipt of advance notice of administrative punishment (attached, indicating the opinions on the above rights) to our bureau within 5 working days from the date of receiving the advance notice. If it is overdue, it will be deemed to have waived the above rights. “
3、 Impact on the company and risk tips
1. As of the disclosure date of this announcement, the company’s production and operation are normal. If the notice of administrative punishment issued by the Shenzhen Securities Regulatory Commission is not received in advance, the notice of administrative punishment shall prevail. Please pay attention to investment risks.
2. As of the disclosure date of this announcement, there has been no significant change in the production and operation of the company. The company and all directors, supervisors and senior managers sincerely apologize to all shareholders and investors for this violation of securities laws and regulations. The company will actively cooperate with the follow-up work of the CSRC and comprehensively improve the level of compliance management and internal control, so as to effectively avoid the recurrence of similar problems.
3. The information disclosure media designated by the company are securities times, Securities Daily, China Securities News and cninfo. Com. The relevant information of the company shall be subject to the announcement published in the above designated information disclosure media. Please pay attention to the risks.
It is hereby announced.
Zhejiang Busen Garments Co.Ltd(002569) board of directors April 8, 2022
