Yang Quan Coal parent firm faces CSRC penalties

Yang Quan Coal Industry Group announced that its controlling shareholder, Huayang New Material Technology Group, received an advance notice of administrative penalties from the CSRC. The penalties stem from alleged violations related to information disclosure regarding the unauthorized transfer of funds from Yang Quan Coal's account to Huayang Group's account between April and June 2021, totaling CNY 1,126,449,959.33. The unauthorized transfer constituted a non-operating capital occupation representing 17.74% of Yang Quan Coal's net assets. The CSRC intends to impose a CNY 4,000,000 fine on Huayang Group, a CNY 2,000,000 fine on Gao Yanqing (who oversaw finance and corporate strategy at Huayang Group), and a CNY 900,000 fine on Fan Zongli (who oversaw account management and transfer of funds). Yang Quan Coal stated that the potential penalties are not against the company itself and are not expected to impact its daily operations.