Subcontracting Transactions definition
Examples of Subcontracting Transactions in a sentence
The Directors consider that the internal control system of the Group is adequate to ensure that the Subcontracting Transactions will be on normal commercial terms and no less favourable to the Company than those offered by independent third parties.
The senior management of the sales and marketing department of the Group will conduct regular checks on a monthly basis to review and assess whether the Subcontracting Transactions are conducted in accordance with the terms of the Master Subcontracting Agreement.
The Company will comply with the relevant provisions under Chapter 14A of the Listing Rules governing continuing connected transactions in the event that the total amount of any of the Sub-contracting Transactions exceeds 2.5% for each of the percentage ratios (other than the profit ratio), or that there is any material amendment to their terms.
As the annual transactional amount for the Sub-contracting Transactions for each of the percentage ratios (other than the profit ratio) is less than 2.5%, the Sub-contracting Transactions are only subject to the reporting and announcement requirements set out in Rules 14A.45 to 14A.47 and are exempt from the independent shareholders’ approval requirement of Chapter 14A of the Listing Rules.
The Subcontractors had not engaged the Company for transactions which are similar in nature to the Subcontracting Transactions, thus no historical transaction figure is available.
Before entering into any agreement in respect of the Subcontracting Transactions, the sales and marketing department of the Group compares the principal terms of the Subcontractors' processing fee receivable by the Group with that of independent customers and ensure the major terms received by the Group, the pricing policies are fair and reasonable and no less favourable than the terms available to the Group from independent customers.
The internal audit department of the Group shall review that the Subcontracting Transactions are and will be conducted in accordance with the terms of the Master Subcontracting Agreement, and report to the audit committee of the Company semi-annually.
The Subcontracting Transactions to be provided could allow stable processing for the Subcontractors which shall resell the products to ultimate customers all over the world.
The Company’s external auditors will review the Subcontracting Transactions annually to check and confirm, among others, whether the pricing terms have been adhered to and whether the relevant caps have been exceeded.
As the annual transactional amounts for the Sub-contracting Transactions for each of the percentage ratios (other than the profit ratio) is less than 2.5%, the Sub- contracting Transactions are only subject to the reporting and announcement requirements set out in Rules 14A.45 to 14A.47 and are exempt from the independent shareholders’ approval requirement of Chapter 14A of the Listing Rules.