Heli Technology and Executives Warned by Chinese Regulator Over Historical Disclosure Lapses

Ningbo Heli Technology Co., Ltd. (603917.SH), along with a key shareholder and a former executive, has received a formal warning from Chinese securities regulators over a long-undisclosed share transfer and nominee agreement dating back to 2015. The omission resulted in inaccurate shareholder information being presented in public filings for over eight years, including in the company's initial public offering documents.

Regulator Cites Disclosure Failures

According to a company announcement, the China Securities Regulatory Commission's (CSRC) Ningbo Bureau issued a warning letter to Heli Technology, co-controlling shareholder Fan Kaishu, and former Board Secretary Fan Kaiyuan. The regulator's decision stated that the violation will be recorded in the national securities and futures market integrity database, a measure that can impact future market activities for the individuals and the company involved.

The regulatory action stems from the company's failure to accurately report its shareholding structure in numerous public disclosures. The inaccuracies persisted from the company's 2017 listing through its 2025 semi-annual report.

The 2015 Nominee Agreement

The core of the issue is a private agreement signed on February 18, 2015, between Fan Kaishu—then a director and deputy general manager—and an individual named Ma Xubiao. The agreement detailed the transfer of 1 million company shares to Ma Xubiao, with the stipulation that Fan Kaishu would hold 500,000 of these shares on behalf of Ma Xubiao in a nominee arrangement.

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This shareholding structure was not made public until the company's 2025 annual report. The regulator's letter noted that a court had later affirmed the existence of the transfer and nominee relationship, even while ruling the agreement itself was invalid for violating company law.

Impact on Public Filings

The CSRC found that the failure to disclose this arrangement rendered shareholder information inaccurate in critical documents provided to investors. Affected filings include the company's IPO prospectus and all periodic reports issued between its 2017 public listing and mid-2025.

Regulators held Fan Kaishu directly responsible as a party to the agreement and a key company figure who held various senior roles during the period. Fan Kaiyuan was cited for his failure as board secretary to report the agreement to the board and organize its timely disclosure, despite being aware of it.