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United States securities and exchange commission logo
August 29, 2022
Yinyu He
Chief Executive Officer
Leju Holdings Ltd
Level G, Building G, No.8 Dongfeng South Road
Chaoyang District , Beijing 100016
The People s Republic of China
Re: Leju Holdings Ltd
Form 20-F for the
Fiscal Year Ended December 31, 2021
File No. 001-36396
Dear Yinyu He:
We have reviewed your filing and have the following comments. In
some of our
comments, we may ask you to provide us with information so we may better
understand your
disclosure.
Please respond to these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to these comments, we may have additional comments.
Form 20-F for the Fiscal Year Ended December 31, 2021
Item 3. Key Information, page 3
1. We note your disclosure
on page 3 regarding the use of a VIE structure. Please clearly
disclose that investors
may never hold equity interests in the Chinese operating
companies. Your
disclosure should also clearly acknowledge that Chinese regulatory
authorities could
disallow this structure, which would likely result in a material change in
your operations and/or
a material change in the value of your securities, including that it
could cause the value
of such securities to significantly decline or become worthless.
Ensure that you provide
a cross-reference to your detailed discussion of all risks facing the
company and the
offering as a result of this structure.
2. We note your disclosure
on page 4 about the legal and operational risks associated with
being based in or
having the majority of the company s operations in China. In your
disclosure, in addition
to your reference to regulatory approvals regarding data security
and anti-monopoly
concerns, please also refer to regulation and statements made by
Yinyu He
FirstName LastNameYinyu He
Leju Holdings Ltd
Comapany
August 29, NameLeju
2022 Holdings Ltd
August
Page 2 29, 2022 Page 2
FirstName LastName
China's government related to the use of variable interest entities,
and make clear that all
of these risks could significantly limit or completely hinder your
ability to offer or
continue to offer securities to investors and cause the value of such
securities to
significantly decline or be worthless.
3. We note your disclosure regarding the HFCAA and PCAOB on page 5 and
page 13
stating that your auditor is currently subject to PCAOB inspection.
Please expand your
disclosure to clearly state whether or not your auditor is subject to
the determinations
announced by the PCAOB on December 16, 2021 and whether the Holding
Foreign
Companies Accountable Act and related regulations will affect your
company.
4. Clearly disclose how you will refer to the holding company,
subsidiaries, and VIEs when
providing the disclosure throughout the document so that it is clear
to investors which
entity the disclosure is referencing and which subsidiaries or
entities are conducting the
business operations. Refrain from using terms such as we or
our when describing
activities or functions of a VIE. In this regard, we note disclosure
on page 1 that in some
but not all contexts, references to "Leju," "we," and "our" include
your VIEs in China. In
addition, where you disclose that the VIEs are consolidated for
accounting purposes, also
clearly state that they are not entities in which you own equity, and
that the holding
company does not conduct operations.
5. Please provide early in the Key Information a diagram of the company
s corporate
structure, identifying the person or entity that owns the equity in
each depicted entity.
6. We note your disclosure on page 3 and throughout the filing that the
Cayman Islands
holding company controls and receives the economic benefits of the
VIEs business
operations through contractual agreements between the VIEs, their
respective
shareholders, and your subsidiaries that provides you with
effective control over those
companies. We also note your disclosure that the Cayman Islands
holding company is the
primary beneficiary of those companies. However, neither the investors
in the holding
company nor the holding company itself have an equity ownership in,
direct foreign
investment in, or control of, through such ownership or investment,
the VIEs.
Accordingly, please refrain from implying that the contractual
agreements are equivalent
to equity ownership in the business of the VIEs. Any references to
control or benefits that
accrue to you because of the VIE should be limited to a clear
description of the conditions
you have satisfied for consolidation of the VIE under U.S. GAAP.
Additionally, your
disclosure should clarify that you are the primary beneficiary of the
VIEs for accounting
purposes.
7. We note the required permissions you disclosed on page 4 and page 5.
Please expand
your disclosure to include each permission or approval that you, your
subsidiaries, or the
VIEs are required to obtain from Cyberspace Administration of China
(CAC) or any other
governmental agency that is required to approve the VIE s
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
Yinyu He
FirstName LastNameYinyu He
Leju Holdings Ltd
Comapany
August 29, NameLeju
2022 Holdings Ltd
August
Page 3 29, 2022 Page 3
FirstName LastName
consequences to you and your investors if you, your subsidiaries, or
the VIEs: (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.
8. We note your disclosure regarding cash and asset flows through your
organization, as well
as disclosure in your risk factors on page 33 regarding governmental
control of currency
conversion. Please revise your disclosure on pages 5 and 6 to also
discuss any restrictions
on foreign exchange and your ability to transfer cash between
entities, across borders and
to U.S. investors.
Risk Factors, page 12
9. We note your discussion of the regulatory and the enforcement risks in
your Summary of
Risk Factors. Please expand your Summary of Risk Factors to include
the significant
liquidity risks with cross-references to the more detailed discussion
of the risk in the
filing. Acknowledge any risks that any actions by the Chinese
government to exert more
oversight and control over offerings that are conducted overseas
and/or foreign investment
in China-based issuers could significantly limit or completely hinder
your ability to offer
or continue to offer securities to investors and cause the value of
such securities to
significantly decline or be worthless.
10. We note your disclosure regarding Chinese government s significant
oversight on page
33. Please revise to clearly disclose that the Chinese government may
intervene or
influence your operations at any time, which could result in a
material change in your
operations and/or the value of your securities. Also, given recent
statements by the
Chinese government indicating an intent to exert more oversight and
control over
offerings that are conducted overseas and/or foreign investment in
China-based issuers,
acknowledge the risk that any such action could significantly limit or
completely hinder
your ability to offer or continue to offer securities to investors and
cause the value of such
securities to significantly decline or be worthless.
Item 5. Operating and Financial Review and Prospects, page 84
11. We note that your press release dated March 31, 2022 discusses the
steep downturn in
China's real estate industry in the second half of 2021, which you
note had a direct and
negative impact on your online advertising and e-commerce businesses.
We also note that
the noted downturn and its impacts on the Chinese real estate industry
have been well
documented in the media. In your next filing, including any potential
interim update on
Form 6-K, please revise your discussion of your operating results and
your discussion of
trend information to consider how the ongoing state of the industry
has impacted your
business. Refer to Item 5. of Form 20-F.
We remind you that the company and its management are responsible for
the accuracy
Yinyu He
Leju Holdings Ltd
August 29, 2022
Page 4
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
You may contact Eric McPhee at 202-551-3693 or Wilson Lee at
202-551-3468 if you
have questions regarding comments on the financial statements and related
matters. Please
contact Shih-Kuei Chen at 202-551-7664 or Pam Long at 202-551-3765 with any
other
questions.
FirstName LastNameYinyu He Sincerely,
Comapany NameLeju Holdings Ltd
Division of
Corporation Finance
August 29, 2022 Page 4 Office of Real Estate
& Construction
FirstName LastName