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Related Party Transactions
 12 Months Ended
Dec. 31, 2021
Related Party Transactions [Abstract]  
RELATED PARTY TRANSACTIONS

NOTE 20– RELATED PARTY TRANSACTIONS

 

The Company records transactions with various related parties. These related party balances as of December 31, 2021 and 2020 and transactions for the years ended December 31, 2021, 2020 and 2019 are identified as follows:

 

(1) Related parties with transactions and related party relationships

 

Name of Related Party  Relationship to the Company
Mr. Hengfang Li  Chief Executive Officer and Chairman of the Board of Directors
Ms. Hong Ma  Wife of Mr. Hengfang Li
Reto International Trading Co. Ltd  The owner of the entity holds more than 5% of the Company’s outstanding common shares
Q Green Techcon Private Limited  Owned by the minority shareholder of REIT India
Shexian Ruibo  The Company owns 41.67% ownership interest in Shexian Ruibo
Zhongrong Honghe Eco Construction Materials Co., Ltd  An entity controlled by Ms. Hong Ma
Hunyuan Baiyang Food Co., Ltd.  An entity controlled by Mr. Hengfang Li
Bei Qi Yin Jian Yi Le (Haikou) Smart Move Science Technology Co., Ltd.  Hainan Yile IoT owns 45% ownership interest in this company
Zhongtou REIT Information Service (Beijing) Co., Ltd  An entity controlled by Mr. Xinyang Li and Ms. Xinran Li, children of Mr. Hengfang Li
Handan Ruisheng Construction Material Technology Co., Ltd.  An entity controlled by Shexian Ruibo

  

(2) Due to related parties

 

As of December 31, 2021 and 2020, the balance of due to related parties was as follows: 

 

  

December 31,

2021

  

December 31,

2020

 
Mr. Hengfang Li  $472,439   $1,019,469 

 

Mr. Hengfang Li is the Chief Executive Officer and major shareholder of the Company. Mr. Li periodically provides working capital loans to support the Company’s operations when needed. Such advances were non-interest bearing and due on demand.

 

(3) Accounts receivable from related parties

 

Accounts receivable from related parties consisted of the following:

 

   December 31,  2021  

December 31,

2020

 
Accounts receivable – related party        
Reto International Trading Co. Ltd  $
-
   $199,999 
Q Green Techcon Private Limited   2,981    
-
 
Hunyuan Baiyang Food Co., Ltd.   40,088    
-
 
Bei Qi Yin Jian Yi Le (Haikou) Smart Move Science Technology Co., Ltd.   50,520    
-
 
Total accounts receivable from related party  $93,589   $199,999 

 

The Company fully collected the accounts receivable as of December 31, 2021 from related parties as of the date of this report.

(4) Advance to suppliers, related party

 

Advance to suppliers, related party, consisted of the following:

 

  

December 31,

2021

  

December 31,

2020

 
Advance to supplier – related party        
Shexian Ruibo*  $3,656,118   $3,872,110 
Q Green Techcon Private Limited   174,099    162,014 
Handan Ruisheng Construction Material Technology Co., Ltd.   12,403    
-　
 
Total  $3,842,620   $4,034,124 

  

* The balance represents the Company’s purchase advances for eco-friendly materials and equipment supplied by Shexian Ruibo.

 

(5) Accounts payable to related parties

 

Accounts payables to related parties consisted of the following:

 

  

December 31,

2021

  

December 31,

2020

 
Accounts payable – related part        
- Q Green Techcon Private Limited  $
    -
   $- 
- Shexian Ruibo.   
-
    153,344 
- Zhongtou Ruitu Information Service (Beijing) Co., Ltd   10,199      
Total  $10,199   $153,344 

 

(6) Sales to related parties

 

Sales to related parties consisted of the following:

 

   For the Years Ended December 31, 
   2021   2020   2019 
Sales to related parties            
Hunyuan Baiyang Food Co., Ltd.   
-
    
-
    83,972 
Shexian Ruibo   61,177    
-
    
-
 
Q Green Techcon Private Limited   220,607    228,814    
-
 
Total  $281,784   $228,814   $83,972 

 

Cost of revenue associated with the sales to these related parties amounted to $175,053, $148,034 and $54,598 for the years ended December 31, 2021, 2020, and 2019, respectively.

 

(7) Purchases from related parties

 

Purchases from related parties consisted of the following:

 

   For the years ended December 31, 
   2021   2020   2019 
Purchase from a relate party            
Q Green Techcon Private Limited.  $228,838   $1,039,152   $
-
 
 Shexian Ruibo   235,946    1,837,841    2,021,934 
Total  $464,784   $2,876,993   $2,021,934 

 

(8) Other related party transactions

 

On September 7, 2020, Beijing REIT entered into a share transfer agreement with the original shareholder of Shexian Ruibo for the acquisition of a 41.67% ownership interest in Shexian Ruibo for a total consideration of $3.6 million (RMB 25 million), including a cash payment of $2.8 million (RMB 18.5 million) and a non-cash contribution of six patents valued at $0.9 million (RMB 6.5 million). The cash consideration was fully paid for the year ended December 31, 2020.