Chapter 1 General Provisions

Article 1   This regulation is formulated in accordance with national laws and regulations and the Group's relevant requirements to strengthen internal management control within the Group, effectively prevent and control the Group's fraud risks; to improve the Group's anti-fraud control and supervision mechanism, and to ensure the healthy and sustainable development of the Group.

Article 2 This system applies to the management, governance, and employees of the Group headquarters and all its wholly-owned enterprises, holding companies, and branches (hereinafter collectively referred to as the "Group").

Chapter 2 Responsibilities

Article 3   All levels of personnel in the Group are responsible for preventing, controlling, and supervising fraudulent activities.

Article 4 The top leaders at all levels of the Group are the first responsible persons for anti-fraud work and should strictly perform their duties and establish an effective anti-fraud responsibility system.

Article 5 Create an honest corporate culture environment, implement and enforce the Group's various rules and regulations for employees, improve the employees' awareness of complying with professional ethics, and effectively prevent the occurrence of fraudulent behavior.

Chapter 3 Regulations

Article 6 Definition: Fraud refers to acts by the Group's management, governance, employees, or third parties using deception or fraudulent means to obtain improper or illegal benefits.

Article 7 Main manifestations:

(1) Falsification of financial reports, i.e., intentional acts that lead to inaccurate financial reports. Including:

1. Intentionally changing accounting principles, modifying data, overstating or understating income; intentionally overstating or understating costs, overstating or understating inventory, work in progress, fixed assets, etc.;

2. Fabricating, concealing, or deleting transactions or items, creating false business contracts, issuing false invoices, etc.;

3. Intentionally using inappropriate accounting policies and estimates, using related party transactions to adjust profits;

4. Forging or altering accounting vouchers and books, concealing or intentionally destroying accounting vouchers, books, and financial reports that should be preserved according to law;

5. Violating national tax laws and related laws and regulations, intentionally evading taxes;

6. Violating national unified accounting systems and the Group's relevant regulations, other accounting fraud that seriously affects the fair presentation of the Group's financial statements.

(2) Accepting bribes, kickbacks, embezzlement, misappropriation of assets, including:

1. Accepting bribes, kickbacks, embezzlement, misappropriation, misappropriation, theft of Group funds and assets, etc.;

2. False transactions to obtain funds, etc.;

3. Setting up slush funds, setting up off-book assets, etc.;

4. Unauthorized development of tertiary industries, encroachment on Group interests, etc.

(3) Violation of regulations or failure to properly perform duties, causing significant economic losses to the Group, and intentionally concealing the facts of the losses, including:

1. Unauthorized and blind external investment, resulting in fund losses or waste;

2. Unplanned construction or over-budget investment, resulting in long-term idleness or waste of engineering projects;

3. Unauthorized guarantees to external parties or loans from financial institutions and external borrowing of funds;

4. Unfair contracts, non-standard business transactions, or cheap sale of company assets;

5. Intentionally failing to perform or improperly performing duties, resulting in damage or loss of assets; or intentionally lending without compensation or illegally donating Group assets;

6. Disclosure of Group trade secrets, other intentional acts that cause financial or asset losses to the company.

Article 8 Information communication channels for anti-fraud:

(1) Through employee handbooks, the Group's various rules and regulations, the Group's internal network, and other methods, timely publicize anti-fraud policies and reporting procedures; regularly conduct training and communication on professional ethics, etc., to ensure that Group employees understand all relevant content of the Group's anti-fraud policies. Key personnel can be organized to visit labor camps and prisons to clarify the consequences of fraudulent behavior and the Group's serious attitude towards preventing fraudulent behavior, and to understand their own responsibilities in complying with the company's anti-fraud policies;

(2) The Group's business dealings with users, suppliers, and other relevant units should be based on honesty and fairness, and convey to them the Group's relevant information and requirements regarding ethical standards and behavioral norms;

(3) Have sufficient ability to collect information on identified fraud risks, anti-fraud control activities, existing fraudulent behavior, and remedial measures, and be able to share relevant information;

(4) Timely analyze whether major fraud events are universal and promptly propose preventive and control measures; report the handling results of major fraud events to all employees of the Group, so that they can understand the harmfulness of violations and learn from them;

(5) The Group's Risk Management Department serves as the Group's anti-fraud reporting and complaint reception center, responsible for receiving reports and complaints about fraudulent behavior, recording, reporting, investigating, and following up on violations and disciplinary violations in reports and complaints; formulating management methods for receiving, investigating, and handling reports and complaints, establishing reporting and complaint channels, clarifying reporting telephone numbers, email addresses, or receiving reporting letters, etc.;

(6) Establish a confidentiality system for reporting information and records, and ensure the independence of personnel receiving and managing reporting information; strengthen security management measures for reporting mailboxes, hotlines, and email addresses; those who illegally disclose whistleblower information or retaliate against whistleblowers will be removed from office, their employment contracts will be terminated, and those who violate the law will be transferred to judicial organs for legal processing;

(7) The Group Risk Management Department should regularly submit written reports to the Group Audit Committee on the classification, analysis, and handling results of reported cases received during the period, and promptly report on serious or significant reported incidents and their investigation and handling.

Article 9 Anti-fraud supervision mechanism:

(1) The Group Risk Management Department supervises the company's fraud risk assessment and anti-fraud measures:

1. Regular or irregular meetings will be held to discuss the effectiveness of fraud risk assessment and anti-fraud measures.

2. Supervise whether the accounting standards, accounting policies, and accounting assessments used by the group and its subsidiaries comply with national accounting regulations.

3. Supervise the group's major unusual transactions, the group's assessment of fraud risks, the possibility of management exceeding the control system, and behaviors that exert undue influence on the financial reporting process, etc.

4. Supervise the implementation of the group's regulations and systems on professional ethics and the reporting mechanism.

5. Supervise the internal audit department's review results of the company's internal control and the implementation of the audit plan for fraud risks.

6. Regularly meet with independent auditors to discuss the possibility of fraud risks in the group.

(II) The group's management is responsible for establishing and maintaining an effective internal control system to prevent fraud.

1. The group's management should anticipate the impact of potential daily fraud incidents and communicate with relevant departments of the group to formulate their own contingency plans, handling procedures, and measures.

2. In the event of fraud, the group's management should handle the matter objectively and fairly, promptly analyze the impact of the fraud incident, and take necessary remedial measures to prevent or respond to similar fraud incidents.

3. If a fraud incident involves the group's main management personnel or requires a large number of additional investigation procedures, an independent legal counsel can be hired to conduct the investigation under the guidance of the audit committee.

(III) The group's internal audit department should regularly organize fraud risk assessments:

1. When formulating the audit work plan, the internal audit department should fully consider the fraud risk and include fraud investigation in the audit plan.

2. Internal auditors should maintain professional prudence in routine audits, pay attention to the assessment and analysis of fraud risks, and promptly identify fraud.

(IV) The group company should initiate necessary investigation procedures and take timely corrective measures for fraud incidents that have occurred.

1. Inspectors implement necessary inspection procedures to determine whether the fraudulent behavior shown by the fraudulent phenomenon has occurred.

2. After completing the necessary fraud investigation procedures, the severity should be considered from both the nature and amount of the fraudulent behavior, and a corresponding investigation report should be issued.

3 Seriously analyze and study the internal control defects, classify them according to their importance and impact, implement responsible departments, take effective corrective measures to avoid or reduce losses, and track the effectiveness of the corrections.

4 If existing control measures cannot control identified fraud risks, appropriate internal control remedial measures should be taken in a timely manner.

Article 10 Accountability

(I) The group company should hold accountable the relevant responsible persons for the occurrence of fraud incidents.

(II) Accountability for fraud includes leadership responsibility and direct responsibility.

1. Leadership responsibility: refers to the responsibility assumed by management personnel with relevant leadership powers within the scope of their work due to dereliction of duty or negligence, resulting in fraudulent events, causing distortion of accounting information, concealment of losses, etc.

2. Direct responsibility: refers to the responsibility assumed by the group's management personnel and their related personnel within their duties, directly operating or participating in relevant decisions, or instructing, instigating, forcing, condoning, shielding others' fraud, and failing to perform or failing to properly perform their duties, resulting in distortion of accounting information, concealment of losses, etc.

(III) The group company will handle and hold accountable the relevant responsible persons for the fraudulent acts that have occurred in accordance with relevant national laws, regulations, and the group's relevant rules and regulations, including but not limited to administrative sanctions, removal from office, dismissal, termination of employment contracts, etc. If a crime is committed, it will be transferred to judicial organs for handling.

Chapter 4 Appendix

Article 11   This system shall come into effect and be implemented from the date of its approval by the company's board of directors.

Article 12   Matters not covered in this system shall be governed by relevant laws, administrative regulations, normative documents, and the company's articles of association.

Article 13 The right to interpret this system belongs to the company's board of directors.

Joincare Pharmaceutical Group Industry Co., Ltd.

202 4 Year 8 Month 27 Day