SecProbe.io

CORRESP
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filename1.htm

    Mason Allen

    Of Counsel

    mallen@cronelawgroup.com

VIA
EDGAR

January
13, 2023

THE
UNITED STATES SECURITIES

AND
EXCHANGE COMMISSION

Washington,
D.C. 20549

    Attn:
    Aamira
    Chaudhry

    Rufus
    Decker

    Re:
    Qilun
    Group Inc.

    Draft
    Registration Statement on Form F-1

    Filed
    November 4, 2022

    CIK
    No.: 0001951378

Dear
Ms. Chaudhry and Mr. Decker:

We
write on behalf of Qilun Group Inc. (the “Company”) in response to comments by the United States Securities and Exchange
Commission (the “Commission”) in its letter dated December 1, 2022, commenting on the Company’s Draft Registration
Statement on Form F-1 filed November 4, 2022 (the “Registration Statement”).

Titling
and paragraph numbering of the comments listed below corresponds to the titling and numbering used in the Commission’s comment
letter.

Draft
Registration Statement on Form F-1

Cover
Page

1. Please
                                            refer to the prospectus cover page. We note your ordinary shares are not listed or quoted
                                            on an existing public trading market. Please note that an at-the-market resale offering under
                                            Rule 415 is not available for registrants with no existing public trading market. Accordingly,
                                            please revise to clarify that the selling stockholders will sell at a fixed price until your
                                            ordinary shares are listed or quoted on an existing public trading market, such as the OTCQB,
                                            OTCQX or OTCBB, and thereafter at prevailing market prices or privately negotiated prices.
                                            Please also disclose the fixed price and clarify in one of the first paragraphs that the
                                            company currently has no existing public trading market and whether the offering is contingent
                                            upon obtaining a listing or quotation on an existing public trading market.

Response:
In response to this comment, the Company has amended the Registration Statement cover page to state that there is currently no public
trading market, that the offering is contingent on obtaining a listing or quotation on an existing public market, and that the selling
stockholders will sell at a fixed price of $0.20 per share until the ordinary shares are listed or quoted on an existing public trading
market, and thereafter at prevailing market prices or privately negotiated prices.

2. Please
                                            revise the seventh paragraph of the prospectus cover page to capture the risk that Chinese
                                            regulatory authorities could change the rules and regulations regarding foreign ownership
                                            in the industry in which you operate.

Response:
In response to this comment, the Company has amended the Registration Statement to state that Chinese regulatory authorities could change
the rules and regulations regarding foreign ownership in the industries in which we operate.

3. Please
                                            revise the prospectus cover page to clarify that the legal and operational risks associated
                                            with operating in China also apply to operations in Hong Kong and Macau.

Response:
In response to this comment, the Company has amened the Registration Statement to state that the legal, regulatory, operating and investment
risks applicable to our operations in China also apply to operations in the special administrative regions of Hong Kong and Macau.

4. We
                                            note your disclosure on pages 4 and 18 that all of your operations are in China. However,
                                            you also state at several points in the prospectus that you have an operating subsidiary
                                            in Hong Kong. Please clarify the geographic scope of your operations and make conforming
                                            disclosures accordingly.

Response:
In response to this comment, the Company has amened the cited disclosure throughout the Registration Statement to refer to operating
subsidiaries in China and to clarify that operations have not begun to date with respect to the Company’s Hong Kong subsidiary.

5. Provide
                                            a description of how cash is transferred through your organization and disclose your intentions
                                            to distribute earnings. State whether any transfers, dividends, or distributions have been
                                            made to date between the holding company and its subsidiaries, or to investors, and quantify
                                            the amounts where applicable. Provide cross-references to the condensed consolidating schedule
                                            and the consolidated financial statements.

Response:
In response to this comment, the Company advises the Staff that the Company does not have a specific cash transfer policy or mechanism
among subsidiaries. The cash transfers made to date among subsidiaries include:

 ● Shenzhen
                                            Houhaitang Culture Communication Co., Ltd. loaned $131,746 to Qilun Culture Development (Shenzhen)
                                            Co., Ltd.;

 ● Shenzhen
                                            Houhaitang Culture Communication Co., Ltd. sold products with amount of $71,121 to Qilun
                                            Culture Development (Shenzhen) Co., Ltd.; and

 ● Qilun
                                            Culture Development (Shenzhen) Co., Ltd. made payment of $27,899 on behalf of Qilun Enterprise
                                            Management Consultant (Shenzhen) Co., Ltd.

The
noted three transfers have been cleared out as of the filling date and there are no remaining balances. The cash transfers were made
occasionally at the discretion of management and were not routine.

There
have been no transfers, dividends or distributions made to date between the holding company and its subsidiaries or to investors. The
Company has no intentions to distribute earnings now and in the foreseeable future.

6. Please
                                            amend your disclosure here and in the summary risk factors and risk factors sections to state
                                            that, to the extent cash in the business is in the PRC or Hong Kong or a PRC or Hong Kong
                                            entity, the funds may not be available to fund operations or for other use outside of the
                                            PRC/Hong Kong due to interventions in or the imposition of restrictions and limitations on
                                            the ability of you or your subsidiaries by the PRC government to transfer cash. On the prospectus
                                            cover page, provide cross-references to these other discussions.

Response:
In response to this comment, the Company has amended the Registration Statement risk factor entitled “We may rely on dividends
and other distributions on equity paid by the operating entities to fund any cash and financing requirements we may have, and any interventions
in or the imposition of restrictions and limitations on the ability of our company or the operating entities by the PRC government to
transfer cash or assets could have a material and adverse effect on our business.” to state that, “[t]o the extent cash in
the business is in accounts located in the PRC or Hong Kong, or held at a PRC or Hong Kong operating entity, the cash may not be available
to fund operations or for other use outside of the PRC or Hong Kong due to interventions in or the imposition of restrictions and limitations
by the PRC government on the ability of you or your subsidiaries to transfer cash outside of the PRC or Hong Kong.” The Company
has also amended the Registration Statement to cross-reference this risk factor on the cover page.

7. Please
                                            revise the prospectus cover page to include the Commission Legend required by Item 501(b)(7)
                                            of Regulation S-K.

Response:
In response to this comment, the Company has amended the Registration Statement to include the Item 501(b)(7) of Regulation S-K legend
on the cover page.

8. Please
                                            revise the prospectus cover page to include the date of prospectus. Refer to Item 501(b)(9)
                                            of Regulation S-K.

Response:
In response to this comment, the Company has amended the Registration Statement to include the date of the prospectus on the cover page.

Our
Products and Services, page 1

9. We
                                            note your disclosure on pages 1 and 49 that you sell books published by third-party publishers
                                            to retail customers. To the extent your business is materially dependent on such third-party
                                            publishers, please identify such third-party publishers and include risk factor disclosure
                                            to address your reliance on such third-party publishers.

Response:
In response to this comment, the Company respectfully advises the Staff that sales from third-party publishers constitute less than 10%
of annual revenue and is not a material component of the Company’s operations or business strategy. The Company has amended the
Registration Statement on page 49 to reflect such details.

10. Please
                                            revise to disclose each permission or approval that you or your subsidiaries are required
                                            to obtain from Chinese authorities to operate your business and to offer the securities being
                                            registered to foreign investors. State whether you or your subsidiaries are covered by permissions
                                            requirements from the China Securities Regulatory Commission (CSRC), Cyberspace Administration
                                            of China (CAC) or any other governmental agency that is required to approve your operations,
                                            and state affirmatively whether you have received all requisite permissions or approvals
                                            and whether any permissions or approvals have been denied. Please also describe the consequences
                                            to you and your investors if you or your subsidiaries: (i) do not receive or maintain such
                                            permissions or approvals, (ii) inadvertently conclude that such permissions or approvals
                                            are not required, or (iii) applicable laws, regulations, or interpretations change and you
                                            are required to obtain such permissions or approvals in the future. To the extent you are
                                            relaying on an opinion of counsel, then counsel should be named and a consent of counsel
                                            filed as an exhibit. Lastly, please revise the permissions and approvals disclosures on the
                                            prospectus cover page to align with the above guidance. In this regard, we note the disclosure
                                            is presented from the passive perspective versus affirmatively addressing that the company
                                            has received all requisite permissions and approvals.

Response:
In response to this comment, the Company respectfully advises the Staff that, according to the Company’s PRC legal counsel, DeHeng
Law Offices (Shenzhen), as of the date of the Registration Statement, our PRC subsidiaries have received from PRC authorities all requisite
licenses, permissions or approvals needed to engage in the businesses currently conducted in China and neither the Company nor the operating
entities have been subject to any investigation, or received any notice, warning, or sanction from the China Securities Regulatory Commission
(the “CSRC”), the Cyberspace Administration of China (the “CAC”), or other applicable government authorities
related to the proposed offering. The Company has amended the Registration Statement to reflect the above-noted disclosure.

Our
Strengths, page 2

11. Please
                                            disclose the basis for your statement here and on page 50 that you have formed a “large
                                            and loyal fan community” or state that it is management’s belief.

Response:
In response to this comment, the Company has amended the Registration Statement to state that “formed what we believe to be a sizeable
and loyal fan community.”

Risk
Factor Summary, page 3

12. Please
                                            revise your disclosure to ensure that each summary risk factor in the “Risks Related
                                            to Doing Business in China” section has a cross-reference to the relevant individual
                                            detailed risk factor including the specific heading and page number.

Response:
In response to this comment, the Company has amended the Registration Statement to revise each summary risk factor in the “Risks
Related to Doing Business in China and Hong Kong” section to include a cross-reference to the relevant individual detailed risk
factor including the specific heading and page number.

Cash
Transfers and Dividend Distributions, page 6

13. Quantify
                                            any cash flows and transfers of other assets by type that have occurred between the holding
                                            company and its subsidiaries, and direction of transfer. Additionally, provide cross-references
                                            to the condensed consolidating schedule and the consolidated financial statements.

Response:
In response to this comment, the Company advises the Staff that the Company has not made any cash transfers or asset transfers between
its subsidiaries and the Company (e.g., the Cayman Islands registrant) and does not anticipate any such transfers for the foreseeable
future.

The
Offering, page 8

14. We
                                            note your disclosure here that you intend to apply to quote your securities on the OTCQB.
                                            However, you state on the prospectus cover page that you intend to seek quotation of your
                                            shares on the OTC Markets, OTCQX, or OTCQB Venture. Please revise your disclosures to consistently
                                            reflect which OTC market you wish to seek quotation on.

Response:
In response to this comment, the Company has amended the Registration Statement to clarify, in each instance, that it intends to apply
its securities to be quoted on the OTCQB.

“The
ongoing global coronavirus COVID-19 outbreak had caused . . .”, page 14

15. Please
                                            expand your disclosure to discuss the material effects that COVID-19 has had on the demand
                                            for your products and operating results. Specifically, please revise these sect