Sinopharm Tech Holdings Limited and Guangdong Tongguanyi Network Technology Co. Ltd. ("Passeasy") entered into a joint venture agreement (the "JV Agreement") to establish a joint venture (the "JV"), mainly for the development of digital customs declaration platform and one-stop customs declaration services (including customs declaration, logistics and goods tracking, etc.), supply chain and other related business areas. The formation of the JV is a new opportunity for the Group in the "Internet Plus" business, which marks the acceleration of the Group's application of the "Internet Plus" business in different business models. The principal terms of the JV Agreement are as follows: Signing date: 16 December 2022, Contracting parties: The Company and Passeasy, Equity in the JV: The Group and Passeasy will hold 51% and 49% of the equity in the JV respectively; The main business of the JV: Mainly engaged in the development of digital customs declaration platform system and one-stop customs declaration service (including customs declaration, logistics and goods tracking, etc.), supply chain and other related business areas, The roles played by the parties: 1. Passeasy will use the self-developed "Passeasy
Digital Customs Declaration Platform" and "Tengyitong"system to provide a technical foundation for the JV, 2. The Group will make use of its own advantages in "Internet Plus" to formulate market strategies and accelerate the nationwide coverage of the digital customs declaration platform, Place of registration of the JV: Mainland China. The JV will apply for the relevant approvals and authorizations required for its establishment and operation. The Board is of the view that the JV Agreement was entered into on normal commercial terms in the ordinary and usual course of business and after arm's length negotiations of the Company. To the best of the knowledge, information and belief of the Board having made all reasonable enquiries, Passeasy is independent of the Company and its connected persons (as defined in the Rules Governing the Listing of Securities on GEM ("GEM") of The Stock Exchange of Hong Kong Limited (the "GEM Listing Rules")) and is not connected with them. The Group has been continuously exploring opportunities for "Internet Plus" business development, including negotiating with industry participants on "Internet Plus" solutions and conducting in-depth discussions in various fields, so as to expand the Group's business scope and development opportunities. Through the JV with Passeasy, the Group will expand its existing "Internet Plus" solution business to digital customs declaration and overall customs declaration and logistics solution services, providing users with new, more professional and safer digital customs declaration services experience. Through the unique advantages of each party, the Board believes that the JV will create advantages by utilizing the existing market network of Passeasy and the self-developed "Passeasy Digital Customs Declaration Platform" and "Tengyitong" system; and the Group will accelerate the nationwide coverage of the digital customs declaration platform system through the "Internet Plus" business experience and marketing strategy, so as to enhance the customer base and recognition of the system brand, and develop for the JV and the Group new development opportunities in the "Internet Plus" business.