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Balances and Transactions with Related Parties | 9 Months Ended
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Sep. 30, 2024
Balances and Transactions with Related Parties [Abstract] |
Balances and Transactions With Related Parties |
| 18. | Balances and Transactions With Related Parties
The principal related parties with which the Company had transactions during the periods 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
Zhengzhou BAK Battery Co., Ltd |  | Note a
Shenzhen BAK Battery Co., Ltd (“SZ BAK”) |  | Former subsidiary and refer to Note b
Shenzhen BAK Power Battery Co., Ltd (“BAK SZ”) |  | Former subsidiary and refer to Note b
Zhejiang Shengyang Renewable Resources Technology Co., Ltd. |  | Note c
Fuzhou BAK Battery Co., Ltd |  | Note d
Zhengzhou BAK Electronics 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 Shenzhen BAK Battery Co., Ltd and Shenzhen BAK Power Battery Co., Ltd
(c) | On September 27, 2023, Hitrans entered into an Equity Transfer Contract (the “Equity Transfer Contract”) with Mr. Shengyang Xu, pursuant to which Hitrans will initially acquire a 26% equity interest in Zhejiang Shengyang Renewable Resources Technology Co., Ltd. (“Zhejiang Shengyang”) from Mr. Xu, an individual who currently holds 97% of Zhejiang Shengyang, for a price of RMB28.6 million (approximately $3.9 million) (the “Initial Acquisition”). Neither Mr. Xu, nor Zhejiang Shengyang is related to the Company.
(d) | Zhengzhou BAK Battery Co., Ltd has 51% equity interest in Fuzhou BAK Battery Co., Ltd. Zhengzhou BAK Battery Co., Ltd is a wholly owned subsidiary of BAK SZ.
(e) | Mr. Xiangqian Li, the Company’s former CEO, is a director of BAK SZ, which has 95% equity interests in Zhengzhou BAK Electronics Co., Ltd..
Related party transactions: The Company entered into the following significant related party transactions:
|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2023 |  |  | 2024 |  |  | 2023 |  |  | 2024 |
Purchase of batteries from Zhengzhou BAK Battery Co., Ltd |  | $ | 7,554,266 |  |  | $ | 24,595 |  |  | $ | 11,057,190 |  |  | $ | 7,036,768 |
Purchase of materials from Zhejiang Shengyang Renewable Resources Technology Co., Ltd |  |  | 3,778,670 |  |  |  | 1,419,467 |  |  |  | 9,008,190 |  |  |  | 4,792,917 |
Sales of batteries to Fuzhou BAK Battery Co., Ltd |  |  | - |  |  |  | 155 |  |  |  | - |  |  |  | 76,076 |
Sales of cathode raw materials to Zhengzhou BAK Battery Co., Ltd |  |  | 5,822,065 |  |  |  | 5,166,669 |  |  |  | 22,815,451 |  |  |  | 14,183,130 |
Sales of cathode raw materials to Zhengzhou BAK Electronics Co., Ltd. |  |  | 126,287 |  |  |  | 186,764 |  |  |  | 264,144 |  |  |  | 337,115 |
Related party balances: Apart from the above, the Company recorded the following significant related party balances as of December 31, 2023 and September 30, 2024: Receivables from a former subsidiary, net
|  | December 31, 2023 |  |  | September 30, 2024 |
Receivables from Shenzhen BAK Power Battery Co., Ltd |  | $ | 74,946 |  |  | $ | 7,580 |
Less: Allowance for credit losses |  |  | - |  |  |  | - |
|  | $ | 74,946 |  |  | $ | 7,580 |
An analysis of the allowance for credit losses is as follows:
Balance as at January 1, 2024 |  | $ | - |
Current period provision, net |  |  | - |
Foreign exchange adjustment |  |  | - |
Balance as at September 30, 2024 |  | $ | - |
Balance as of December 31, 2023 and September 30, 2024 consisted of receivable for sales of cathode materials to Shenzhen BAK Power Battery Co., Ltd. Other balances due from/ (to) related parties
|  | December 31, 2023 |  |  | September 30, 2024 |
Trade receivable, net – Zhengzhou BAK Battery Co., Ltd. (i) |  | $ | 12,441,715 |  |  | $ | 4,921,121 |
Trade receivable, net – Zhengzhou BAK Electronics Co., Ltd. (ii) |  | $ | 226,143 |  |  | $ | 215,896 |
Bills receivable – Issued by Zhengzhou BAK Battery Co., Ltd (iii) |  | $ | - |  |  |  | 9,957 |
Bills receivable – Issued by Zhengzhou BAK Electronics Co., Ltd (iv) |  | $ | 47,767 |  |  | $ | - |
Prepayment to supplier - Zhengzhou BAK Battery Co., Ltd (v) |  | $ | - |  |  | $ | 3,898,336 |
Trade payable, net – Zhengzhou BAK Battery Co., Ltd (vi) |  | $ | 803,685 |  |  | $ | - |
Trade payable, net – Zhejiang Shengyang Renewable Resources Technology Co., Ltd (vii) |  | $ | 3,489,324 |  |  | $ | 3,500,853 |
Deposit paid for acquisition of long-term investments – Shenzhen BAK Power Battery Co., Ltd (note 14) |  | $ | 7,101,492 |  |  | $ | 16,500,192 |
Dividend payable to non-controlling interest of Hitrans (note 17) |  | $ | 1,256,745 |  |  | $ | 1,283,507 |
(i) | Representing trade receivables from sales of cathode raw materials to Zhengzhou BAK Battery Co., Ltd. Up to the date of this report, Zhengzhou BAK Battery Co., Ltd. repaid $1.0 million to the Company.
(ii) | Representing trade receivables from sales of cathode raw materials to Zhengzhou BAK Electronics Co., Ltd.
(iii) | Representing bills receivable issued by Zhengzhou BAK Battery Co., Ltd.. Bills receivable as of September 30, 2024 were pledged to bank as security for issuance of bills payable (note 15).
(iv) | Representing bills receivable issued by Zhengzhou BAK Electronics Co., Ltd.. Bills receivable as of September 30, 2024 were pledged to bank as security for issuance of bills payable (note 15).
(v) | Representing the prepayments to Zhengzhou BAK Battery Co., Ltd for purchase of batteries.
(vi) | Representing trade payables on purchase of batteries from Zhengzhou BAK Battery Co., Ltd.
| (vii) | Representing trade payables on purchase of cathode raw materials from Zhejiang Shengyang Renewable Resources Technology Co., Ltd.
Payables to a former subsidiary Payables to a former subsidiary as of December 31, 2023 and September 30, 2024 consisted of the following:
|  | December 31, 2023 |  |  | September 30, 2024 |
Payables to Shenzhen BAK Power Battery Co., Ltd |  | $ | (411,111 | ) |  | $ | (407,560 | )
Balance as of December 31, 2023 and September 30, 2024 consisted of payables for purchase of inventories from Shenzhen BAK Power Battery Co., Ltd.

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- Definition The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-2 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-5 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-6 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 235 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org/1943274/2147477968/946-235-50-2 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 235 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147477968/946-235-50-2 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147483326/850-10-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 220 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.6-07(2)(g)(3)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 220 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.6-07(2)(c)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 220 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.6-07(2)(e)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/850/tableOfContent Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Publisher FASB -URI https://asc.fasb.org/1943274/2147483326/850-10-50-6 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147483326/850-10-50-1 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147483326/850-10-50-1 + Details
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