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Aonong Bio-Tech fined 5.65 mln yuan for failing to disclose lawsuits and related-party transactions
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Aonong Bio (603363.SH) and four executives have been fined a total of 5.65 million yuan by the Fujian Securities Regulatory Bureau for failing to disclose material litigation, arbitration, and related-party transactions in a timely manner. According to the penalty notice, between June 2024 and February 2025, the company disclosed multiple batches of new litigation and arbitration cases, of which 206 cases totaling 905 million yuan were not disclosed on time. These amounts represented significant percentages of the company's audited net assets, ranging from 22.78% to 58.76%. Additionally, from January to March 2025, Aonong and its subsidiaries conducted related-party transactions worth 160.47 million yuan (31.89% of net assets) but delayed disclosure until March 28. The company was ordered to correct the violations, issued a warning, and fined 250 million yuan. Chairman Wu Youlin was fined 1.4 million yuan, former board secretary Peng Jiang 1.05 million yuan, former chairman Su Mingcheng 500,000 yuan, and former CFO Yang Zhou 200,000 yuan. Aonong apologized to investors and stated the fine will impact net profit but not overall operations or financial condition.
Source report
Source: China Business Journal Reporters: Sun Ruxiang, Xia Xin | Beijing
Aonong Bio-Tech (603363.SH) announced on September 18 that the company and several individuals involved had received an Administrative Penalty Decision from the Fujian Securities Regulatory Bureau. The company and four responsible persons were fined a total of 5.65 million yuan for failing to disclose major litigation, arbitration, and related-party transactions as required.
Details of Disclosure Violations
According to the penalty decision, Aonong Bio-Tech disclosed 55 new litigation and arbitration cases on June 17, 2024, of which 27 were not disclosed in a timely manner. These involved a total amount of 117.174 million yuan, accounting for 23.29% of the company's most recent audited net asset value.
On July 10, 2024, the company disclosed 50 new cases, with 38 not disclosed on time, involving 295.6687 million yuan, or 58.76% of audited net assets.
On July 29, 2024, the company disclosed 52 new cases, with 33 not disclosed on time, involving 209.0277 million yuan, or 41.54% of audited net assets.
On November 12, 2024, the company disclosed 91 new cases, with 59 not disclosed on time, involving 114.6215 million yuan, or 22.78% of audited net assets.
On February 7, 2025, the company disclosed 71 new cases, with 49 not disclosed on time, involving 168.7137 million yuan, or 33.53% of audited net assets.
In total, 206 litigation and arbitration cases were not disclosed in a timely manner, involving a combined amount of 905 million yuan.
Related-Party Transaction Violations
In addition, Aonong Bio-Tech failed to disclose related-party transactions as required. From January 1 to March 26, 2025, the company and its subsidiaries conducted related-party transactions totaling 160.4659 million yuan, representing 31.89% of the company's most recent audited net asset value. The company did not disclose some of these transactions until March 28, 2025.
Penalties Imposed
Based on the nature, circumstances, and social harm of the violations, and considering mitigating factors such as the parties' admission of fault and acceptance of penalties, the Fujian Securities Regulatory Bureau decided:
- Aonong Bio-Tech: Ordered to rectify, issued a warning, and fined 2.5 million yuan.
- Wu Youlin (then Chairman, Vice Chairman, and General Manager): Fined 1.4 million yuan.
- Peng Jiang (then Vice General Manager and Board Secretary): Fined 1.05 million yuan.
- Su Mingcheng (then Chairman): Fined 500,000 yuan.
- Yang Zhou (then Director, Vice General Manager, and CFO): Fined 200,000 yuan.
Company Response
Aonong Bio-Tech stated that, in accordance with the penalty decision, it must pay the 2.5 million yuan fine within 15 days of receiving the decision. The company said it will handle the payment within the specified period. The fine will be recorded in current-period profit or loss, which will have a certain impact on net profit but will not materially affect the company's production, operations, or financial condition.
The company also expressed sincere apologies to investors and stated that it will reflect deeply on the matter, learn from the experience, improve its awareness and standards of compliant operations, strengthen internal governance, and enhance the quality of information disclosure.
(Editor: Xia Xin | Reviewer: Li Huimin | Proofreader: Yan Jingning) (Source: China Business Journal)
Source
中国经营报Eastern
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Aonong Bio fined 5.65 million yuan for failing to disclose 905 million yuan in litigation