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United States securities and exchange commission logo
June 9, 2023
Loo Choon Sen
Chief Financial Officer
China Yuchai International Limited
16 Raffles Quay
#39-01A Hong Leong Building
Singapore 048581
Re: China Yuchai
International Limited
Form 20-F for the
Fiscal Year ended December 31, 2022
Filed April 26,
2023
File No. 001-13522
Dear Loo Choon Sen:
We have limited our review of your filing to the financial
statements and related
disclosures 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 20-F for the Fiscal Year ended December 31, 2022
Risk Factors, page 8
1. Please expand the risk
factor disclosure on page 19, under the heading "Our financial
condition, results of
operations, business and prospects may be adversely affected if we
are unable to implement
the Reorganization Agreement and the Cooperation Agreement,"
to clarify the status
and relevance of these agreements, which you indicate were
formulated during the
period 2003-2007, and to identify the counterparties in the
agreements and to
describe your present relationship with those counterparties.
Given your disclosure
stating that non-compliance with the continued expansion and
diversification
provisions of these agreements "could have a material adverse effect" on
your financial
condition, results of operations, business or prospects, we believe that you
should describe your
obligations concerning business expansion and diversification,
Loo Choon Sen
FirstName LastNameLoo
InternationalChoon Sen
China Yuchai Limited
Comapany
June 9, 2023NameChina Yuchai International Limited
June 9,
Page 2 2023 Page 2
FirstName LastName
including quantification of any relevant metrics, specification of
milestones and timelines,
and any contractual or reasonably possible consequences for
non-compliance.
The disclosure expressing uncertainty as to whether such requirements
will be fully
implemented, or if implementation will effectively resolve all of the
difficulties regarding
your investment in Yuchai, should also be modified to clarify the
extent to which you
have been unable to comply with such requirements since entering into
the agreements, to
include a description of the obstacles that you have encountered and
any options or
alternatives that you may have to resolve such matters.
2. We note your risk factor disclosures on pages 11 and 12, under the
heading "We are or
may be subject to risks associated with strategic alliances, including
joint ventures,"
explaining that Yuchai Xin-Lan New Energy Power Technology Co., Ltd. (
Yuchai Xin-
Lan ), was formerly a wholly-owned subsidiary of Guangxi Yuchai
Machinery Company
Limited ("Yuchai") though since February 2023 has been an 87.7% owned
subsidiary of
Yuchai, and we see corresponding illustration in your organizational
chart on page 39.
Please reconcile these disclosures with information provided in your
subsequent events
disclosure on page F-91, explaining that "the Group s equity
interest in Yuchai Xin-Lan
decreased from 69.5 % as of December 31, 2022 to 67.0 %" in connection
with the entity
receiving various capital contributions from other investors.
Please also expand your disclosure regarding the conveyance of Yuchai
Xin-Lan (Jiangsu)
Hydrogen Energy Technology Co., Ltd to Yuchai Xin-Lan, as necessary to
describe the
terms of the transaction including the circumstances/precipitating
events or rationale for
the conveyance, along with an indication of its significance.
3. We note that you have provided various risk factor disclosures that
appear to be
responsive to some of the concerns identified in our December 2021
sample letter to
China Based Companies, which may be viewed our website at the
following address:
https://www.sec.gov/corpfin/sample-letter-china-based-companies.
However, we believe that some incremental disclosures should be
provided to further
clarify certain matters as identified in the comments that follow,
which include references
to existing disclosures that could be expanded to include this
information, although you
may suggest alternate placement for such incremental disclosures.
Please submit the specific language that you propose to address these
concerns, including
any associated revisions to the summary of risk factors provided on
pages 3 and 4.
4. Please expand the risk factor disclosure on page 15, under the heading
"We are dependent
on information technology and our systems and infrastructure face
certain risks, including
cybersecurity risks and data leakage risks" to also address recent
events indicating greater
oversight by the Cyberspace Administration of China (CAC) over data
security, to explain
how this oversight impacts your business and any future offerings, and
to indicate the
extent to which you believe that you are compliant with the
regulations or policies that
Loo Choon Sen
China Yuchai International Limited
June 9, 2023
Page 3
have been issued by the CAC prior to filing your annual report for
2022.
5. Please expand the risk factor disclosure on page 21, under the heading
"Changes in
political or social conditions, government policies or regulations in
China could have a
material and adverse effect on our business and results of
operations," to further
clarify the significant regulatory, liquidity, and enforcement risks
associated with your
corporate structure and being based in China, and to address the
following points.
Discuss risks arising from the legal system in China, including
risks and uncertainties
regarding the enforcement of laws, to include any rights under
the Reorganization
and Cooperation agreements mentioned on page 19, and clarify that
rules and
regulations in China can change quickly with little advance
notice.
Discuss risks 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, and clarify
that such risks could
result in a material change in your operations and/or the value
of your securities
including those that you may register for sale in the future.
Discuss risks that any actions by the Chinese government to
exert more oversight and
control over potential 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 clarify
that such actions could
cause the value of your securities to significantly decline or
become worthless.
In closing, 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 Yong Kim, Staff Accountant, at 202-551-3323 or Karl
Hiller, Branch
Chief, at 202-551-3686 with any questions.
FirstName LastNameLoo Choon Sen Sincerely,
Comapany NameChina Yuchai International Limited
Division of
Corporation Finance
June 9, 2023 Page 3 Office of Energy
& Transportation
FirstName LastName