For several consecutive years, Guangdong Huatie Tongda High-speed Railway Equipment Corporation (000976.SZ) and related personnel are to be fined more than twenty million yuan by the Guangdong Securities Regulatory Bureau for falsifying annual reports.

Guangdong Huatie Tongda High-speed Railway Equipment Corporation (000976.SZ) issued an announcement stating that the company and its actual controller, Xuan Ruiguo, received a "Notice of Filing" (Securities Regulatory Filing No. 0062023018 and 0062023019) from the China Securities Regulatory Commission (CSRC) on July 12, 2023. The CSRC has decided to initiate an investigation into the company and Xuan Ruiguo for suspected violations of information disclosure laws and regulations, in accordance with relevant provisions of the Securities Law of the People's Republic of China and the Administrative Penalty Law of the People's Republic of China. On February 8, 2024, the company received a "Notice of Administrative Penalties and Market Entry Restrictions" from the Guangdong Securities Regulatory Bureau. According to reports, the company and related individuals are involved in the following illegal activities: firstly, false records were found in the annual reports of Huatie Shares for 2020 and 2021; secondly, Huatie Shares did not disclose related party transactions in accordance with regulations, resulting in significant omissions in the annual reports for 2019, 2020, 2021, and 2022. These actions by Huatie Shares are suspected of violating Article 63 and Article 67, paragraphs 1, and 2, Article 78, paragraphs 1 and 2, and Article 80, paragraphs 1 and 2, Item 3 of the Securities Law of 2005, constituting the illegal acts described in Article 193, paragraph 1 of the Securities Law of 2005 and Article 197, paragraph 1 and 2. Huatie Shares have consistently made false records or significant omissions in their annual reports for four consecutive years, with a high proportion of major omissions in certain years. As of December 31, 2022, the company's controlling shareholder and other related parties still had a non-operational fund utilization balance (including principal and interest) of 1,337.859 million yuan. Taking into account the above circumstances and the company's cooperation in the investigation, the penalty amount will be determined in accordance with the law. Based on the facts, nature, circumstances, and degree of social harm caused by the illegal acts, as well as the special circumstances of the violation spanning the old and new versions of the Securities Law, the Guangdong Securities Regulatory Bureau intends to decide the following: 1. Give a warning to Guangdong Huatie Tongda High-speed Railway Equipment Corporation and impose a fine of 8 million yuan. 2. Give a warning to Xuan Ruiguo and impose a fine of 8 million yuan, with a separate fine of 4.5 million yuan for his role as a directly responsible supervisor and 3.5 million yuan for his role as the actual controller. 3. Give a warning to Zhang Xuan and impose a fine of 3 million yuan. 4. Give warnings to Wang Chengwei and Yang Yonglin, and impose fines of 800,000 yuan each. 5. Give warnings to Shi Songshan, Han Wenlin, Jiang Hong, Duan Ying, and Wang Ying, and impose fines of 600,000 yuan each. 6. Give warnings to Tang Xiaoming, Ming Liang, Liang Weichao, and Yuan Jiangang, and impose fines of 550,000 yuan each. 7. Give a warning to Chu Hongquan and impose a fine of 500,000 yuan. As the actual controller of Huatie Shares, Xuan Ruiguo, who was the former chairman and vice chairman of the company, organized and instructed the involvement in fraudulent activities, failure to disclose related parties and related transactions as required, seriously disrupting the order of the securities market, and having committed serious illegal acts. The Guangdong Securities Regulatory Bureau intends to implement a lifelong market entry restriction against Xuan Ruiguo.