Bayi Steel faces penalties for disclosure violations

Xinjiang Ba Yi Iron & Steel Co. (Bayi Steel) and its controlling shareholder, Xinjiang Ba Yi Iron & Steel Group Co. (Ba Yi Steel Group), have been notified of impending administrative penalties. This follows an investigation by the Xinjiang Securities Regulatory Bureau into alleged information disclosure violations regarding non-operating related party transactions in 2022, 2023, and 2024.

Bayi Steel allegedly failed to disclose significant transfers to and from Ba Yi Steel Group totaling RMB 3.64bn and RMB 3.68bn respectively in 2022, RMB 2.77bn and RMB 2.81bn in 2023, and RMB 2.53bn and RMB 2.51bn in 2024. These transactions were not disclosed in the annual reports for those years.

The proposed penalties include a warning and a fine of RMB 3 million for Bayi Steel, and a warning and a fine of RMB 4 million for Ba Yi Steel Group. Additionally, several current and former key executives, including Wu Bin, Ke Shanliang, Liu Wenzhuang, and Fan Guokang, face warnings and individual fines ranging from RMB 1 million to RMB 3.5 million for their roles in the alleged violations.

Bayi Steel confirmed these findings do not trigger mandatory delisting under Shanghai Stock Exchange rules and that its operations continue normally. The company expressed sincere apologies to investors and pledged to improve internal governance and information disclosure quality.