Correspondence 0001213900-23-081818 from Baiya International Group Inc. (BIYA) (CIK 0001944712) (BIYA)
Baiya International Group Inc. (BIYA) (CIK 0001944712)
Date: Oct. 31, 2023 · CIK: 0001944712 · Accession: 0001213900-23-081818
AI Filing Summary & Sentiment
Referenced dates: September 14, 2023
Letter
Via EDGAR Division of Corporation Finance Office of Trade & Services Re: Baiya International Group Inc. Amendment No. 3 to Draft Registration Statement on Form F-1 Submitted August 24, 2023 CIK No. 0001944712
Dear Sir/Madam:
On behalf of Baiya International Group Inc. (the “Company”), we are responding to the Staff’s comment letter dated September 14, 2023, related to the above referenced Amendment No. 3 to Draft Registration Statement on Form F-1.
For ease of reference, we have copied the Staff’s comments in italics as indicated below with the Company’s responses.
Amendment No. 3 Draft Registration Statement submitted August 24,
Management’s Discussion and Analysis and Results of Operations Comparison of the year ended December 31, 2022 and 2021, page 76
1. In regard to entrusted recruitment service, you disclose revenue decreased by approximately $6.8 million, or 71.3%, for the year ended December 31, 2022 mainly due to the Chinese government’s COVID-19 epidemic prevention policy that caused operations and production of factories of some major customers to be suspended. Please revise to quantify the material impacts COVID-19 has had on your results, to the extent practicable. As the COVID-19 pandemic was also present during 2021, clarify if your fiscal 2022 was impacted differently by COVID-19 from your fiscal 2021, and if so, how, especially regarding any circumstances that caused 2022 revenues to decrease. Also, discuss whether there was any negative impact to your revenue in fiscal 2022 caused by the disclosed reduction in customers from 36 at December 31, 2021 to 27 at December 31, 2022 and the reason for the decrease in the number of customers. Additionally, revise to clearly describe declining revenues during the periods presented and any associated known trends. Further, you disclose the demand of labor from employer companies in China has been continuously decreased since beginning of 2022 as a result of decreased production orders for factories. Disclose your expectation of this continuing and the impact on your results if it does.
RESPONSE: We respectfully advise the staff that the disclosure on pages 76 and 77 have been revised to address the above.
ARIZONA • CALIFORNIA • COLORADO • CONNECTICUT • DELAWARE • FLORIDA • GEORGIA • ILLINOIS • INDIANA • KANSAS • KENTUCKY • LOUISIANA MARYLAND • MASSACHUSETTS • MINNESOTA • MISSISSIPPI • MISSOURI • NEVADA • NEW JERSEY • NEW MEXICO • NEW YORK • NORTH CAROLINA OHIO • OREGON • PENNSYLVANIA • RHODE ISLAND • TENNESSEE • TEXAS • UTAH • VIRGINIA • WASHINGTON • WASHINGTON D.C. • WEST VIRGINIA
October 31, 2023
Page 2
2. You state the increase in cost of revenues of project outsourcing service for 2022 was in line with the increased revenue from project outsourcing service. Yet, project outsourcing service revenue decreased for 2022. Please clarify the reason for the increased cost of revenues for 2022.
RESPONSE: We respectfully advise staff that both the revenue and costs of project outsourcing services have increased. However, due to the impact of exchange rates, the revenue for project outsourcing services appears to have decreased when it is translated into U.S. dollars. We have updated the disclosure on page to address the above.
3. Please disclose whether the increase labor cost incurred to fulfill outsourcing services in 2022 is a known trend.
RESPONSE: We respectfully advise the staff that the disclosure on pages 78 have been revised to address the above.
4. You disclose China Post is one of your three major customers. You disclose the increase in general and administrative expense in 2022 was mainly due to the increase in bad debt allowance regarding China Post due to its slow collection. Please disclose whether you expect the slow collection with China Post to continue and, if so, the impact on your operations.
RESPONSE: We respectfully advise the staff that the disclosure on page 79 have been revised to address the above.
5. We note the changes you made to your disclosure appearing on the cover page, Prospectus Summary and Risk Factor sections relating to legal and operational risks associated with operating in China and PRC regulations. It is unclear to us that there have been changes in the regulatory environment in the PRC since the review of your last amendment filed February 14, 2023, warranting revised disclosure to mitigate the challenges you face and related disclosures. The Sample Letters to China-Based Companies sought specific disclosure relating to the risk that the PRC government may intervene in or influence your operations at any time, or may exert control over operations of your business, which could result in a material change in your operations and/or the value of the securities you are registering for sale. We remind you that, pursuant to federal securities rules, the term “control” (including the terms “controlling,” “controlled by,” and “under common control with”) as defined in Securities Act Rule 405 means “the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract, or otherwise.” The Sample Letters also sought specific disclosures relating to uncertainties regarding the enforcement of laws and that the rules and regulations in China can change quickly with little advance notice. We do not believe that your revised disclosure referencing the PRC government’s evolution of its regulatory oversight conveys the same risk. Please restore your disclosures in these areas to the disclosures as they existed in your amendment filed on February 14, 2023.
RESPONSE: We respectfully advise the Staff that we have revised the disclosures on the cover and pages 6, 11, 40, 42, and 94 to address the above.
Please contact me at 916-646-8288, or my partner, Daniel B. Eng, at 415-262-8508, with any questions or further comments regarding the Company’s responses to the Staff’s comments.
Very truly yours,
/s/ John P. Yung
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filename1.htm
John P. Yung
2020 West El Camino Avenue, Suite 700
Sacramento, California 95833
John.Yung@lewisbrisbois.com
Direct: 916.646.8288
October 31, 2023
Via EDGAR
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Trade & Services
100 F Street NE
Washington, DC 20549
Re: Baiya International Group Inc.
Amendment No. 3 to Draft Registration Statement
on Form F-1
Submitted August 24, 2023
CIK No. 0001944712
Dear Sir/Madam:
On behalf of Baiya International
Group Inc. (the “Company”), we are responding to the Staff’s comment letter dated September 14, 2023, related to the
above referenced Amendment No. 3 to Draft Registration Statement on Form F-1.
For ease of reference, we
have copied the Staff’s comments in italics as indicated below with the Company’s responses.
Amendment No. 3 Draft Registration Statement submitted August 24,
2023
Management’s Discussion and Analysis and Results of Operations
Comparison of the year ended December 31, 2022 and 2021, page 76
1. In regard to entrusted recruitment service, you disclose revenue decreased by approximately $6.8 million,
or 71.3%, for the year ended December 31, 2022 mainly due to the Chinese government’s COVID-19 epidemic prevention policy that caused
operations and production of factories of some major customers to be suspended. Please revise to quantify the material impacts COVID-19
has had on your results, to the extent practicable. As the COVID-19 pandemic was also present during 2021, clarify if your fiscal 2022
was impacted differently by COVID-19 from your fiscal 2021, and if so, how, especially regarding any circumstances that caused 2022 revenues
to decrease. Also, discuss whether there was any negative impact to your revenue in fiscal 2022 caused by the disclosed reduction in customers
from 36 at December 31, 2021 to 27 at December 31, 2022 and the reason for the decrease in the number of customers. Additionally, revise
to clearly describe declining revenues during the periods presented and any associated known trends. Further, you disclose the demand
of labor from employer companies in China has been continuously decreased since beginning of 2022 as a result of decreased production
orders for factories. Disclose your expectation of this continuing and the impact on your results if it does.
RESPONSE: We respectfully advise the staff that the disclosure on pages 76 and 77 have been revised to address
the above.
ARIZONA
• CALIFORNIA • COLORADO • CONNECTICUT • DELAWARE • FLORIDA • GEORGIA • ILLINOIS • INDIANA •
KANSAS • KENTUCKY • LOUISIANA MARYLAND • MASSACHUSETTS • MINNESOTA • MISSISSIPPI • MISSOURI • NEVADA
• NEW JERSEY • NEW MEXICO • NEW YORK • NORTH CAROLINA OHIO • OREGON
• PENNSYLVANIA • RHODE ISLAND • TENNESSEE • TEXAS • UTAH • VIRGINIA • WASHINGTON • WASHINGTON
D.C. • WEST VIRGINIA
October 31, 2023
Page 2
2. You state the increase in cost of revenues of project outsourcing service for 2022 was in line with
the increased revenue from project outsourcing service. Yet, project outsourcing service revenue decreased for 2022. Please clarify the
reason for the increased cost of revenues for 2022.
RESPONSE: We respectfully advise staff that both the revenue and costs of project outsourcing services have increased.
However, due to the impact of exchange rates, the revenue for project outsourcing services appears to have decreased when it is translated
into U.S. dollars. We have updated the disclosure on page to address the above.
3. Please disclose whether the increase labor cost incurred to fulfill outsourcing services in 2022 is
a known trend.
RESPONSE: We respectfully advise the staff that the disclosure on pages 78 have been revised to address the
above.
4. You disclose China Post is one of your three major customers. You disclose the increase in general
and administrative expense in 2022 was mainly due to the increase in bad debt allowance regarding China Post due to its slow collection.
Please disclose whether you expect the slow collection with China Post to continue and, if so, the impact on your operations.
RESPONSE: We respectfully advise the staff that the disclosure on page 79 have been revised to address the above.
5. We note the changes you made to your disclosure appearing on the cover page, Prospectus Summary and
Risk Factor sections relating to legal and operational risks associated with operating in China and PRC regulations. It is unclear to
us that there have been changes in the regulatory environment in the PRC since the review of your last amendment filed February 14, 2023,
warranting revised disclosure to mitigate the challenges you face and related disclosures. The Sample Letters to China-Based Companies
sought specific disclosure relating to the risk that the PRC government may intervene in or influence your operations at any time, or
may exert control over operations of your business, which could result in a material change in your operations and/or the value of the
securities you are registering for sale. We remind you that, pursuant to federal securities rules, the term “control” (including
the terms “controlling,” “controlled by,” and “under common control with”) as defined in Securities
Act Rule 405 means “the possession, direct or indirect, of the power to direct or cause the direction of the management and policies
of a person, whether through the ownership of voting securities, by contract, or otherwise.” The Sample Letters also sought specific
disclosures relating to uncertainties regarding the enforcement of laws and that the rules and regulations in China can change quickly
with little advance notice. We do not believe that your revised disclosure referencing the PRC government’s evolution of its regulatory
oversight conveys the same risk. Please restore your disclosures in these areas to the disclosures as they existed in your amendment filed
on February 14, 2023.
RESPONSE: We respectfully advise the Staff that we have revised the disclosures on the cover and pages 6, 11, 40,
42, and 94 to address the above.
Please contact me at 916-646-8288,
or my partner, Daniel B. Eng, at 415-262-8508, with any questions or further comments regarding the Company’s responses to the Staff’s
comments.
Very truly yours,
/s/ John P. Yung
John P. Yung of
LEWIS BRISBOIS BISGAARD & SMITH llp
cc: Weilai Zhang, Chairman
of Baiya International Group Inc.
Siyu
Yang, CEO of Baiya International Group Inc.
Dian
Zhang, CFO of Baiya International Group Inc.
Fang
Liu, Partner, VCL Law LLP
LEWIS BRISBOIS BISGAARD & SMITH LLP
www.lewisbrisbois.com