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Balances and Transactions With Related Parties
 3 Months Ended
Mar. 31, 2022
Related Party Transactions [Abstract]  
Balances and Transactions With Related Parties

16. Balances and Transactions With Related Parties

 

The principal related parties with which the Company had transactions during the years presented are as follows:

 

Name of Entity or Individual   Relationship with the Company
New Era Group Zhejiang New Energy Materials Co., Ltd. 　 Shareholder of company’s subsidiary
Shenzhen Baijun Technology Co., Ltd 　 Shareholder of company’s subsidiary
Zhengzhou BAK Battery Co., Ltd 　 Note a
Zhengzhou BAK New Energy Technology Co., Ltd 　 Note b
Zhengzhou BAK Electronics Co., Ltd   Note c
Shenzhen BAK Battery Co., Ltd 　 Former subsidiary and refer to Note d
Shenzhen BAK Power Battery Co., Ltd 　 Former subsidiary and refer to Note d
Hangzhou Juzhong Daxin Asset Management Co., Ltd   Note e

 

(a)Mr. Xiangqian Li, the Company’s former CEO, is a director of Zhengzhou BAK Battery Co., Ltd.

 

(b)Mr. Xiangqian Li is a director of Zhengzhou BAK New Energy Vehicle Co., Ltd, which has 29% equity interests in Zhengzhou BAK New Energy Technology Co., Ltd.

 

(c)Shenzhen BAK Power Battery Co., Ltd has 95% equity interests in Zhengzhou BAK Electronics Co., Ltd.

 

(d)

Mr. Xiangqian Li is a director of Shenzhen BAK Battery Co., Ltd and Shenzhen BAK Power Battery Co., Ltd

 

(e)Hangzhou Juzhong Daxin Asset Management Co., Ltd. is the trustee of 85% of registered equity interests of Hitrans (note 11)

 

Related party transactions:

 

The Company entered into the following significant related party transactions:

 

   For the
three months ended
March 31,		 
   2021   2022 
   　   　 
Purchase of finished goods from Zhengzhou BAK Battery Co., Ltd 　  $1,259,309   $5,164,433 
Sales of finished goods and raw materials to Zhengzhou BAK Battery Co., Ltd 　 　   108,290    25,823,532 
Sales of finished goods and raw materials to Zhengzhou BAK Electronics Co., Ltd   412,353    
-
 
Sales of finished goods and raw materials to Shenzhen BAK Power Battery Co., Ltd 　 　   
-
    112,468 

 

Related party balances:

 

Apart from the above, the Company recorded the following significant related party balances as of December 31, 2021 and March 31, 2022:

 

Receivables from former subsidiary

 

   December 31,
2021		   March 31,
2022		 
   　   　 
Receivables from Shenzhen BAK Power Battery Co., Ltd  $2,263,955   $1,134,585 

 

Balance as of December 31, 2021 and March 31, 2022 consisted of receivable for sales of cathode and precursor to Shenzhen BAK Power Battery Co., Ltd. Up to the date of this report, Shenzhen BAK Power Battery Co., Ltd repaid $0.5 million to the Company.

 

Amount due from non-controlling interest

 

   December 31,
2021		   March 31,
2022		 
Shenzhen Baijun Technology Co., Ltd  　   　 
Current 　  $125,883   $126,161 
Non-current   62,941    63,081 
　 　  $188,824   $189,242 

 

In August 2018, Guangdong Hitrans and Shenzhen Baijun entered into a services contract for the provision of consultancy service to assist Guangdong Hitrans to obtain the license for recycling solid wastes with a contract sum of RMB3,000,000 ($465,362). During August and September 2018, RMB1,500,000 ($232,681) was paid to Shenzhen Baijun as deposit. In 2020, Guangdong Hitrans and Shenzhen Baijun entered into supplemental agreement to cancel the services contract and Shenzhen Baijun agreed to refund the deposit paid by four installments from 2021 throughout 2023. The amount due from Shenzhen Baijun is interest fee and RMB300,000 ($45,952) repayable by December 2020, RMB400,000 ($62,048) repayable by December 30, 2021, RMB400,000 ($62,048) repayable by December 30, 2022 and RMB400,000 ($62,049) repayable by December 30, 2023.

 

Amount due from related parties

 

   December 31,
2021		   March 31,
2022		 
           
Hangzhou Juzhong Daxin Asset Management Co., Ltd (Note 11) 　  $472,061   $473,104 

 

The above balances are due on demand, interest-free and unsecured.

 

Other balances due from/ (to) related parties

 

   December 31,
2021		   March 31,
2022		 
   　   　 
Trade receivable, net – Zhengzhou BAK Battery Co., Ltd. (i)  $14,583,061   $12,963,529 
           
Trade receivable, net – Zhengzhou BAK New Energy Technology Co., Ltd.  (ii) 　  $459,714   $173,471 
           
Trade payable, net – Zhengzhou BAK Battery Co., Ltd  $(572,768)  $(3,057,449)
           
Dividend payable to non-controlling interest of Hitrans 　  $(1,444,737)  $(1,446,583)

 

(i)Up to the date of this report, Zhengzhou BAK Battery Co., Ltd. repaid $12.5 million to the Company.

 

(ii)Up to the date of this report, Zhengzhou BAK New Energy Technology Co., Ltd repaid $173,471 to the Company.

 

Payables to former subsidiaries

 

Payables to former subsidiaries as of December 31, 2021 and March 31, 2022 consisted of the following:

 

   December 31,
2021		   March 31,
2022		 
         
Payables to Shenzhen BAK Power Battery Co., Ltd 　   (326,507)   (325,624)
　 　  $(326,507)   (325,624)

 

Balance as of December 31, 2021 and March 31, 2022 consisted of payables for purchase of inventories from BAK International (Tianjin) Limited and Shenzhen BAK Power Battery Co., Ltd. From time to time, to meet the needs of its customers, the Company purchased products from these former subsidiaries that it did not produce to meet the needs of its customers.