Aonong Bio fined 5.65 mln yuan for failing to disclose lawsuits and related-party deals

Fujian Securities Regulatory Bureau imposes penalties totaling RMB 2.5 million on the company, with additional fines on four executives.

According to the Administrative Penalty Decision issued by the Fujian Securities Regulatory Bureau, Aonong Bio failed to disclose a significant number of lawsuits and arbitration cases in a timely manner across multiple disclosure events in 2024 and 2025.

Key Disclosure Violations

The following instances of delayed disclosure were identified:

• June 17, 2024: Aonong Bio disclosed 55 new lawsuits and arbitration cases, of which 27 were not disclosed in a timely manner. The total amount involved was RMB 117.174 million, accounting for 23.29% of the absolute value of the company's most recent audited net assets.

• July 10, 2024: Aonong Bio disclosed 50 new lawsuits and arbitration cases, of which 38 were not disclosed in a timely manner. The total amount involved was RMB 295.6687 million, accounting for 58.76% of the absolute value of the company's most recent audited net assets.

• July 29, 2024: Aonong Bio disclosed 52 new lawsuits and arbitration cases, of which 33 were not disclosed in a timely manner. The total amount involved was RMB 209.0277 million, accounting for 41.54% of the absolute value of the company's most recent audited net assets.

• November 12, 2024: Aonong Bio disclosed 91 new lawsuits and arbitration cases, of which 59 were not disclosed in a timely manner. The total amount involved was RMB 114.6215 million, accounting for 22.78% of the absolute value of the company's most recent audited net assets.

• February 7, 2025: Aonong Bio disclosed 71 new lawsuits and arbitration cases, of which 49 were not disclosed in a timely manner. The total amount involved was RMB 168.7137 million, accounting for 33.53% of the absolute value of the company's most recent audited net assets.

In total, 206 lawsuits and arbitration cases were not disclosed in a timely manner, involving an aggregate amount of RMB 905 million.

Related-Party Transaction Disclosure Failure

Additionally, Aonong Bio failed to disclose related-party transactions as required. From January 1 to March 26, 2025, the company and its subsidiaries engaged in related-party transactions totaling RMB 160.4659 million, accounting for 31.89% of the absolute value of the company's most recent audited net assets. Some of these transactions were not disclosed until March 28, 2025.

Penalties Imposed

Based on the facts, nature, circumstances, and social harm of the violations, and taking into account mitigating factors such as the parties' admission of guilt and acceptance of punishment, the Fujian Securities Regulatory Bureau issued the following penalties:

• Aonong Bio: Ordered to make corrections, issued a warning, and fined RMB 2.5 million.
• Wu Youlin (then Chairman, Vice Chairman, and General Manager): Warning and fine of RMB 1.4 million.
• Peng Jiang (then Deputy General Manager and Board Secretary): Warning and fine of RMB 1.05 million.
• Su Mingcheng (then Chairman): Warning and fine of RMB 500,000.
• Yang Zhou (then Director, Deputy General Manager, and Chief Financial Officer): Warning and fine of RMB 200,000.

Company Response

Aonong Bio stated that, according to the Administrative Penalty Decision, the company must pay the fine of RMB 2.5 million within 15 days from the date of receiving the decision. The company will handle the payment procedures in accordance with the law within the prescribed period.

The fine will be recorded in the current period's profit and loss, having a certain impact on the company's net profit for the current period, but it will not have a material impact on the company's production, operations, or financial condition.

Aonong Bio expressed sincere apologies to investors and requested their understanding. The company stated that it would deeply reflect on the issues, seriously learn from the lessons, enhance its awareness and level of standardized operations, strengthen internal governance compliance, and improve the quality of information disclosure.

Source: China Business Journal