20-F

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 20-F

[   ]  REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) or (g) OF THE SECURITIES EXCHANGE ACT OF 1934
OR
[ X ]  ANNUAL REPORT PURSUANT TO SECTION 13 Or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2010
OR
[   ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE OF 1934
OR
[   ]  SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE OF 1934

Commission file number 0-20386

CHAI-NA-TA CORP.
(Exact name of Registrant as specified in its charter)

NOT APPLICABLE
(Translation of Registrant’s Name into English)

BRITISH COLUMBIA, CANADA
(Jurisdiction of incorporation or organization)

UNIT 100 – 12051 HORSESHOE WAY, RICHMOND, BRITISH COLUMBIA V7A 4V4
(Address of principal executive offices)

Securities registered or to be registered pursuant to Section 12(b) of the Act:
NONE

Securities registered or to be registered pursuant to Section 12(g) of the Act:
COMMON STOCK, WITHOUT PAR VALUE
(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:
None

Indicate the number of outstanding shares of each of the issuer's classes of capital or common stock as of the close of the period covered by the annual report.
Common    34,698,157

Indicate by check mark if the registrant is a well-known seasonal issuer, as defined in Rule 405 of the Securities Act.
Yes[   ]   No [ X ]

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Yes[   ]   No [ X ]

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 12 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
Yes [ X ]   No[   ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.
Large accelerated filer [   ]   Accelerated filer [   ]   Non-accelerated filer [ X ]

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
US GAAP [   ]   IFRS [   ]   Other [ X ]

If “Other” has been checked, indicate by check mark which financial statement item the registrant has elected to follow:
Item 17 [ X ]   Item 18 [   ]

If this is an annual report, indicated by check mark whether the registrants is a shell company
Yes [   ]   No [ X ]

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Chai-Na-Ta Corp.
FORM 20-F ANNUAL REPORT
FOR YEAR ENDED DECEMBER 31, 2010

TABLE OF CONTENTS

Part I	.	3
ITEM 1	IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS	3
ITEM 2	OFFER STATISTICS AND EXPECTED TIMETABLE	3
ITEM 3	KEY INFORMATION	3
ITEM 4	INFORMATION ON THE COMPANY	9
ITEM 5	OPERATING AND FINANCIAL REVIEW AND PROSPECTS	15
ITEM 6	DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES	22
ITEM 7	MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS	26
ITEM 8	FINANCIAL INFORMATION	27
ITEM 9	THE OFFER AND LISTING	28
ITEM 10	ADDITIONAL INFORMATION	29
ITEM 11	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	35
ITEM 12	DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES	36
PART II		36
ITEM 13	DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES	36
ITEM 14	MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS	36
ITEM 15	CONTROLS AND PROCEDURES	37
ITEM 16	RESERVED	37
PART III		39
ITEM 17	FINANCIAL STATEMENTS	39
ITEM 18	FINANCIAL STATEMENTS	40
ITEM 19	EXHIBITS	40
SIGNATURE PAGE		41
CONSOLIDATED FINANCIAL STATEMENTS		42

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PART I

ITEM 1  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS 

Not applicable.

ITEM 2  OFFER STATISTICS AND EXPECTED TIMETABLE 

Not applicable.

ITEM 3  KEY INFORMATION 

SELECTED FINANCIAL DATA

The selected consolidated financial data of the Company as of and for each of the years ended December 31, 2010, 2009, 2008, 2007 and 2006 has been derived from the Company’s audited consolidated financial statements which are prepared in accordance with Canadian generally accepted accounting principles, or “Canadian GAAP”. Canadian GAAP differs in certain material respects from United States generally accepted accounting principles, or “US GAAP”. For a discussion of the differences between Canadian GAAP and US GAAP as they relate to the Company, see note 21 to the audited consolidated financial statements, which are included in Item 17 of this annual report. The selected consolidated financial data set forth below is presented in Canadian GAAP unless otherwise indicated, and is qualified in its entirety by reference to, and should be read in conjunction with, the Company’s complete consolidated financial statements including the notes to such financial statements contained in Item 17 of this annual report. You should not take historical results as necessarily indicative of the results that may be expected for any future period.

In this Annual Report, unless otherwise specified, all dollar amounts are expressed in Canadian Dollars (CDN$). The Government of Canada permits a floating exchange rate to determine the value of the CDN$ against the United States Dollar (US$). At December 31, 2010, US$1.00 was equal to CDN$0.99.

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Table No. 1
Selected Financial Data
(CDN$ in 000, except Earnings/Loss per Share and Share Data)
	Year Ended		Year Ended		Year Ended		Year Ended		Year Ended
	12/31/2010		12/31/2009		12/31/2008		12/31/2007		12/31/2006
Canadian GAAP
Revenue	8,951		6,941		9,232		7,562		5,928
Gross Profit (Loss) (2)	1,287		368		(2,685	)	(2,567	)	(5,541	)
Operating Loss (4)	(53	)	(1,410	)	(4,224	)	(4,430	)	(7,462	)
Net Income (Loss) (4)	759		669		(4,670	)	(3,329	)	(9,461	)
Earnings (Loss) per Share – Basic and Diluted (4)	0.02		0.02		(0.13	)	(0.10	)	(0.27	)
Weighted Average Number of Common Shares Used to Calculate Basic and Diluted	34,698		34,698		34,698		34,698		34,698
Earnings (Loss) per Share (3)
Dividends declared per Share	0		0		0		0		0
Working Capital	8,751		8,968		5,456		7,424		7,525
Ginseng Crops (1)	3,149		6,052		7,486		11,395		14,519
Capital Assets	2,232		2,513		2,678		3,795		5,793
Total Assets	12,999		17,849		20,890		25,613		29,693
Net Assets	8,014		7,144		6,111		11,242		14,258
Term Debt – Non Current	2,984		6,499		8,619		6,973		8,366
Capital Stock	38,246		38,246		38,246		38,246		38,246
US GAAP
Revenue	8,951		6,941		9,232		7,562		5,928
Net Income (Loss)	1,261		174		(4,666	)	(3,317	)	(9,439	)
Earnings (Loss) per Share – Basic and Diluted (4)	0.04		0.01		(0.13	)	(0.10	)	(0.27	)
Dividends declared per Share	0		0		0		0		0
Total Assets	12,999		17,346		20,882		25,600		29,669
Term Debt – Non Current	2,984		6,499		8,619		6,973		8,366
Capital Stock	38,226		38,226		38,226		38,226		38,226

1.	Ginseng plants reach maturity and can be harvested at the end of their third year of growth. Total acreage under cultivation is 140 acres at December 31, 2010 (266 at December 31, 2009, 392 acres at December 31, 2008, 629 acres at December 31, 2007 and 966 acres at December 31, 2006). The Company values these plants at the lower of cost and net realizable value.
2.	Under US GAAP, the interest capitalised into Ginseng Crops would not be eligible for capitalisation. These amounts would be expensed in the period incurred.
3.	Options to purchase 343,400, and 403,300 shares of common stock were outstanding in 2007 and 2006, respectively, but were not included in the computation of diluted number of common shares because their effect would have been anti-dilutive.
4.	During 2008, 2007 and 2006, the Company incurred write-downs of $2,998,000, $2,735,000 and $5,639,000, respectively, on inventory and crop costs which caused a significant decrease in net earnings (loss) in total and on a per share basis compared to other years.

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Table No. 2 sets forth the rate of exchange for the CDN$ for the last five years and the most recent six months.

For purposes of this table, the rate of exchange means the noon buying rate in New York City for cable transfers in foreign currencies as certified for customs purposes by the Federal Reserve Bank of New York. The table sets forth the number of CDN$ required under that formula to buy one US$.

Table No. 2 US$/CDN$
Fiscal Year Ended	Average	High	Low	Close
12/31/2010	1.03	1.08	0.99	0.99
12/31/2009	1.14	1.30	1.03	1.05
12/31/2008	1.07	1.30	0.97	1.22
12/31/2007	1.07	1.19	0.92	0.99
12/31/2006	1.13	1.19	1.10	1.17
Month Ended		High	Low	Close
02/28/2011		1.00	0.97	0.97
01/31/2011		1.01	0.98	1.00
12/31/2010		1.02	0.99	0.99
11/30/2010		1.03	1.00	1.03
10/31/2010		1.04	1.00	1.02
09/30/2010		1.06	1.02	1.03

RISK FACTORS

The Company may from time to time make written or oral forward-looking statements. Written forward-looking statements may appear in this document and other documents filed with the Securities and Exchange Commission, in press releases, in reports to shareholders, on the Company’s website, and other documents. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein.

Such estimates, projections or other forward looking estimates involve various risks and uncertainties as outlined below. We caution the reader that important factors in some cases have affected and could materially affect actual results in the future, and cause actual results to differ materially from the results expressed in any estimates, projections or other forward-looking statements. Prospective investors should consider carefully the risk factors set out below.

Chai-Na-Ta is subject to a number of business and financial risks including: agricultural risk such as weather and disease, commodity price risk for ginseng bulk root, exchange risk (predominantly United States and Hong Kong dollar related), the lengthy growing cycle for ginseng, interest rate risk, credit risk and the concentration of customers, and future need for financing.

Going Concern

5

The Company did not plant new crops in 2009 or 2010 and is expecting to cease operations in their current form after completing the harvest in 2011 and the sale of the inventory from that harvest in 2012. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. For the year ended December 31, 2010, the Company had an operating loss of $53,000 and net earnings of $759,000 and has an accumulated deficit of $31,487,000 as at December 31, 2010 along with positive working capital of $8,751,000 and net cash inflows for the year of $171,000. Management anticipates there will be positive cash inflows from operations for 2011 and 2012.

Agricultural Risks

The Company’s primary business is the cultivation and marketing of North American ginseng. Ginseng farming is subject to agricultural risks such as weather and disease and risks of low yields, poor crop quality, and crop failure. Insurance is available to cover such risks but the relatively high costs have resulted in the Company electing to self-insure.

Although the Company believes that its Integrated Crop Management System and diversification of farming operations will help mitigate risks, there can be no assurance that such policies or procedures will be effective in reducing such risks and accordingly, the Company’s business, financial condition, operating results and cash flows may be materially affected.

Product Pricing

The marketing of bulk and graded North American ginseng in world markets is subject to pricing risks. The price of North American ginseng may be affected by factors such as the size, shape, color, taste, and quality of the harvest for the Company and the industry at large, as well as other factors in any given year. These are factors that the Company may not be able to control in the short term.

North American ginseng root prices remained at low levels in 2009 but there was a significant increase at the end of 2010. Although the Company believes that prices will be stronger in 2011 than in 2010, significant changes in the supply of or demand for North American ginseng may adversely impact the price of ginseng roots and have a material adverse effect on the Company’s business, financial condition, operating results and cash flows.

Lengthy Growing Cycle for Ginseng

As the cycle for growing ginseng takes several years from the time of planting to the time of harvesting, our future profitability is also impacted by our ability to accurately predict demand for our products in future years. Unanticipated decreases in demand or excess supplies in world markets could adversely affect profitability due in part to the limitation in our inability to make adjustments to the size of our crops in reaction to short term swings in supply and demand. Lower than expected yields and quality could have a material adverse effect on the Company’s business, financial condition, operating results and cash flows.

Availability of Suitable Land

The Company leases approximately 163 acres and owns 50 acres of farm land in Canada of which 140 acres are currently under ginseng cultivation. Generally, the Company uses farm land only for one ginseng crop as it is generally believed that ginseng depletes the soil of nutrients necessary for a second successful ginseng crop.

6

Since the Company does not plan to make any additional plantings, the availability of suitable farm land will no longer have an effect on the Company's business, financial condition, operating results and cash flows.

Competition

The ginseng industry is quite competitive as the Company competes with numerous other long established ginseng growers. Most of these competitors are managed by private companies or individuals who have smaller acres under cultivation and harvest fewer pounds of ginseng but also have lower overhead costs compared to the Company. A high amount of ginseng harvested by the competition can adversely affect the price that the Company can achieve for its ginseng.

Credit Risk and the Concentration of Customers

The Company is exposed to credit risk on accounts receivable from customers. In order to manage its credit risk, the Company carefully monitors credit terms, and investigates credit history. Payments or deposits are usually received before shipments of inventory to the customer and credit is typically granted only to customers with established relationships or those customers which have been subject to a credit review and approval by management. When such relationships have not been established or credit reviews have not been acceptable, letters of credit may be used to secure such payment or revenues may not be recognized until collection.

The Company’s product is typically sold to major ginseng brokers in Hong Kong or Canada and a limited number of smaller direct customers. During the years ended December 31, 2010, 2009 and 2008, the Company had sales of approximately 89% to its top four customers, approximately 78% to its top three customers, and approximately 87% to its top three customers in each year, respectively. The Company believes that a limited number of customers will continue to represent a significant portion of its total revenue. Although the Company does not consider itself economically dependent upon any single customer or combination of customers due to the existence of other potential brokers capable of purchasing the Company’s supply, there can be no assurance that the Company will be able to maintain its current significant customers or secure significant new customers on similar terms and this may have a material adverse effect on the Company’s business, financial condition, operating results and cash flows.

During the years ended December 31, 2010, 2009 and 2008, the Company had sales of approximately 57%, 79% and 87% to customers in the Hong Kong and China geographic region. Although the Company sold a smaller proportion of its inventory to customers in Hong Kong and China in 2010, the Company believes that the majority of its domestic customers will resell the product in Hong Kong and China. The Company expects sales to markets in Hong Kong and China to continue to represent the majority of the Company’s sales. Any adverse change in the demand for ginseng in Hong Kong and China may have a material adverse effect on the Company’s business, financial condition, operating results and cash flows.

Risks Associated with International Operations

The Company operates in international markets and conducts business in Canada (bulk root farming operations and certain bulk root sales) and Hong Kong (bulk root sales centre in Asia). There are a number of risks inherent in the Company’s international business activities, including changes in regulatory requirements, tariffs and other trade barriers, costs and risks associated with foreign markets, differing culture and business practices, potentially adverse tax consequences, the burdens of complying with a wide variety of foreign laws, war, insurrection, terrorism and other political risks and factors beyond the Company’s control. Exchange risks are also present as currencies may fluctuate at different rates depending on economic, political and other factors. There can be no assurance that adverse changes in the above noted factors will not materially affect the Company’s business, financial condition, operating results and cash flows.

7

Foreign Exchange

The Company transacts primarily in US$, CDN$ and Hong Kong dollar (“HK$”) denominations. The Hong Kong Monetary Authority has set up a linked exchange rate system in which the HK$ is limited to a trading range of HK$7.75 – HK$7.85 against the US$. The Company’s long-term debt is denominated in US$. The Company monitors its exposure to foreign exchange risk and balances its foreign currency holdings to reduce exposure to any one currency by engaging in foreign exchange contracts and by repatriating any excess funds. Fluctuations in currency exchange rates, particularly the weakening or strengthening of the US$ against the CDN$ could have a significant impact on our results of operations.

Market for Common Shares; Potential Volatility of Stock Price

The trading prices of the Common Shares have been subject to wide fluctuations in recent years. There can be no assurance that the market price of the Common Shares will not significantly fluctuate from its current level. Furthermore, the low average trading volumes for the Company’s Common Shares may impact the liquidity of the shares or the ultimate price at which they can be sold.

Financing of Current Operations

The Company relies on the sale of inventory to fund the maintenance and harvest of ginseng crops that will be harvested in the future. To fund current operations the Company will first try and sell inventory but if the Company cannot reach acceptable selling terms the Company will attempt to fund current operations with additional financing. There can be no assurance that such financing will be available or available on acceptable terms. This could have a material adverse effect on the Company's business, financial condition, operating results and cash flows.

Long-Term Financing

The Company has historically used term debt financing to finance capital asset acquisitions and short-term borrowings and operating lines to finance crops and working capital needs. In 2009, the Company extended a term loan facility that had been established in 2006 to finance the general working capital requirements of the Company. Interest rate risk is managed by arranging most term debt financing with fixed rates for the life of the obligations.

Directors, Officers and Key Employees

The success of the Company is currently largely dependent on the performance of its officers and key senior management. The loss of the services of these persons will have a materially adverse effect on the Company’s business and prospects. The Company has offered retention bonuses to its officers and key senior management in an effort to ensure that they will stay with the Company through the expected final harvest in 2011 and the sale of inventory from that harvest in 2012. There is no assurance the Company can maintain the services of its officers and key senior management or other qualified personnel required to operate its business. Failure to do so could have a material adverse affect on the Company. The Company has not purchased any “key-man” insurance with respect to any of its directors or officers to the date hereof. The loss of any key officer or employee of the Company could have an adverse impact on the Company, its business and its financial position.

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ITEM 4  INFORMATION ON THE COMPANY 

HISTORY AND DEVELOPMENT OF THE COMPANY

The Company and Operations

Chai-Na-Ta Corp. (“Chai-Na-Ta” and the “Registrant” or the “Company”) was incorporated on August 12, 1981, under the Canada Business Corporations Act. The Company originally was named Chai-Na-Ta Ginseng Products Limited. During 1994, the name was changed to Chai-Na-Ta Corp. Chai-Na-Ta, together with its subsidiaries, is engaged in the growing, processing and marketing of North American ginseng. Ginseng, a woodland plant with species native to both China and North America, is prized for its root which has been the most valuable herb in Oriental medicine for over 2,000 years. The vast proportion of North American ginseng is farm grown.

The corporate head office is located at: Unit 100 - 12051 Horseshoe Way, Richmond, British Columbia, V7A 4V4, the current contact person is Wilman Wong, C.E.O.; and the telephone number is (604) 272-4118. The head office operations include corporate administration, corporate finance, human resources, sales and marketing, and investor relations. The Company maintains farms in the vicinity of its farm office in Otterville Ontario.

The Company listed its common stock on the Toronto Stock Exchange ("TSX") in October 1989; the stock symbol was CC. On April 28, 2006, the Company shares were delisted by the Toronto Stock Exchange as the Company had not met the continued listing requirements of the Exchange. The Company listed its common stock on the North American Stock Dealers Automatic Quotation (“NASDAQ”) Stock Market in October 1992. The Company’s stock was delisted from NASDAQ in April 1999 for not meeting the listing requirements. The Company commenced trading on the NASDAQ’s OTC Bulletin Board in April 1999. The stock symbol is CCCFF.

The Company’s wholly-owned subsidiary, Chai-Na-Ta Farms Ltd. (“CNT Farms”) is headquartered in Richmond, British Columbia and carries out the planting, growing and harvesting of the Company’s ginseng crops. CNT Farms also handles the storage of the Company’s root inventory and manages the distribution of inventory directly to local customers or to customers in Asia through its wholly-owned subsidiary, CNT Trading (Hong Kong) Limited (“CNT HK”). CNT Farms also carries out crop research through its agricultural staff.

The Company also has a wholly-owned subsidiary, Unique Formulations Inc. (“Unique”) which previously operated out of Portland, Oregon as a wholesaler of ginseng and non-ginseng based herbal products to the U.S. market. As part of the Company’s efforts to reduce operating costs, the Portland office was closed in November 1999 and the operations were then administered from the head office in British Columbia, Canada. Unique has been inactive since 2003.

The Company incorporated CNT HK on October 13, 1999 to carry out direct marketing, sales and distribution functions for North American ginseng in Hong Kong for distribution through Asia. CNT HK sells ginseng roots directly to brokers, distributors and certain customers in the Far East, primarily China, who use the bulk ginseng root for a variety of purposes.

The Company incorporated its wholly-owned subsidiary, CNT Nutraceuticals Ltd. (“CNTN”) on February 3, 2004 to operate a showroom in Richmond, British Columbia and carry out direct marketing and sales of graded roots and ginseng-based value-added products to customers in Canada. The direct marketing and operation of the showroom were scaled down in 2005 due to cash flow restraints. The operations of CNTN is now limited to selling its existing inventory.

9

The Company’s principal capital expenditures incurred during 2010, 2009 and 2008 were $86,000, $145,000, and $139,000, respectively, which related to purchases of property, plant and equipment located in Canada.

Financing

On September 1, 2009 the Company agreed to an extension of an existing HK$51,500,000 loan facility from More Growth Finance Limited (“More Growth”). The Company has repaid HK$21,125,000 ($2,820,000) and US$878,000 ($892,000) during the year ended December 31, 2010 bringing the balance due down to US$3,000,000 ($2,984,000) at December 31, 2010. The loan is unsecured and bears interest at 6.25% per annum. The remaining portion of the loan is due on September 1, 2012; however, the Company repaid the remaining balance of the loan in the first quarter of 2011.

At December 31, 2009, the Company had a $500,000 revolving demand operating loan with a Canadian chartered bank at a rate of prime plus 3.75% per annum. Based on its positive cash position, the Company could not draw on this facility as of December 31, 2009. The loan availability reduced to zero effective March 31, 2010. As at December 31, 2010, $NIL (2009 - $NIL, 2008 - $1,060,000) had been drawn under the operating loan.

On September 4, 2008, the Company secured a $2,000,000 non-revolving term loan from a Canadian chartered bank with an interest rate of prime plus 1.875% per annum which was fully repaid by the due date of May 31, 2009. The loan was secured by the Company's property located near Kamloops, British Columbia.

BUSINESS OVERVIEW

Ginseng Farming

There are two main types of ginseng recognised in the world. Asian or Korean ginseng (Panax ginseng C.A. Meyer), is a herb indigenous to the mountainous forests of eastern Asia. North American ginseng (Panax quinquefolius) is a woodland plant native to North America. Wild woodland ginseng has been harvested nearly to extinction in both Asia and North America and this has stimulated the demand for farm grown ginseng.

Cultivated North American ginseng is grown under artificial shade with a heavy mulch of straw to replicate the conditions found on the forest floor in the hardwood forests of its native habitat. In the late summer and early fall, the ginseng seeds are planted in raised beds, which provide the necessary drainage and solar warming of the soil during the spring. After the straw mulch is applied to conserve moisture and to protect the plants from hard frosts, the shade structure is erected over the plants. The shade cloth is left off the gardens in the spring to allow the soil to warm in the sun. As the plants emerge and the sun gets stronger, the shade cloth is put in place to provide the optimum growing environment for a healthy crop. The shade cloth is removed in the winter months to allow snow cover so that the root remains dormant over the winter. This annual cycle is repeated until the third or fourth year when the root is harvested, typically using mechanical methods.

Historically, the Company had chosen to farm in two areas, British Columbia and Ontario. Due to the Company’s ongoing problem in British Columbia with rusty roots, an aesthetic problem that decreases the perceived value of the root but does not affect its medicinal properties, the Company made the decision in 2005 to permanently discontinue planting in British Columbia. The company closed its British Columbia operations in 2009 after completing the final harvest in 2008.

The sandy tobacco land of southern Ontario allows good drainage, resulting in exceptional growth rates and high quality North American ginseng root. Careful selection of farm sites and scrupulous attention to garden drainage and ventilation substantially reduces the Company's farming risks, while taking advantage of the excellent growing conditions. The Company conducts an extensive battery of tests on each garden to determine water retention characteristics, pH and plant nutrient levels. The Company then adjusts soil fertility and pH to optimum levels for ginseng growth. Once the crop is seeded, the Company's "Integrated Crop Management" program operates seven days a week to monitor nutrients, soil moisture and temperature which are critical to optimum root growth. As the root crop is harvested, the condition and yield of each garden is measured to permit re-evaluation of the production system.

10

As at December 31, 2009, the Company has under lease 163 acres and owns 50 acres of farmland of which 140 are under ginseng cultivation in Ontario. The southern region of Ontario has abundant farm land that could be used for ginseng farming and lease costs are relatively low. This availability is important because farm land is usually used for only one ginseng crop, the growing of which is generally believed to deplete the soil of nutrients necessary for a second successful ginseng crop.

Due to the low prices for the 2008 harvest in both British Columbia and in Ontario and the 2009 harvest in Ontario, the Company decided not to plant new crops in Ontario in 2009 or 2010. Despite the significant improvement in ginseng prices for the 2010 harvest and the improvement in both the yield and quality of its roots, the Company is planning to cease operations in their current form after completing the harvest in 2011 and the sale of the inventory from that harvest in 2012

Table No. 3 Ginseng Farming Operations
Calendar	New Acreage Planted	Total Acres Under Cultivation	Acres Harvested	Harvest Yield in lbs Per Acre	Total Harvest in lbs
2010	0	140	126	4,345	544,940
2009	0	266	126	3,541	446,212
2008	109	392	350	2,824	988,456
2007	0	629	332	2,767	918,963
2006	40	966	311	2,576	801,662
2005	188	1,240	352	2,240	787,402
2004	460	1,431	240	2,116	506,626
2003	354	1,211	370	2,096	775,630
2002	304	1,284	359	2,666	956,996
2001	329	1,339	346	2,816	975,577

Medicinal Properties

Ginseng is sold in capsule, slice, tablet, tea, powder, extract, whole root form and as additives to various consumer products. The amount of active ingredients (ginsenosides) varies with each product and each brand. Though it is not a rule, extracts generally contain the highest concentration of active ingredients, followed by capsules, powders, tablets, slices, whole roots, and teas.

Western medicine does not recognise ginseng's medicinal properties; however scientific study of ginseng began in the early 19th century. The chemical component of ginseng is very complex and varies in different species and from the different processing methods used. Asian and North American ginseng are similar in chemical composition. They both contain ginsenosides, which are recognized as the main active ingredients in ginseng but the amount and quality of the ginsenosides varies between the two species. In addition to the more than 30 ginsenosides identified by scientists around the world, other elements such as fatty acids, amino acids, peptides, polysaccharides, vitamins and minerals have been discovered in different parts of the ginseng plant. Many of these non-ginsenoside components are believed to have immunity enhancing and hypoglycaemic activities.

11

While Western medicine remains unconvinced of ginseng's effectiveness, millions of users around the world believe in the plant's therapeutic powers. Ginseng has been regarded as an important health product in many Asian cultures for over 2,000 years. Some of the perceived benefits of North American ginseng include:

• Reduced stress/relaxant;

• Regulated blood sugar;

• Strengthened immune function;

• Antioxidant (anti-aging);

• Hypotensive;

• Enhanced mental activity; and

• Synergized activity of anti-cancer drugs.

Competition

The Company produces North American ginseng, which is a distinctly different product from the consumer’s perspective from Asian ginseng grown in Korea and China. Based on information obtained through discussion with customers, suppliers and review of available farming industry literature, management estimates that the Company currently produces approximately 10% of the total North American ginseng supply produced annually in North America.

Competitors currently producing North American ginseng consist primarily of hundreds of small growers (less than one hundred acres) located in southern Ontario, central British Columbia and Wisconsin and one large publicly-traded company.

The Company competes through the production of high quality products, lower production costs achieved through economies of scale and an extensive marketing and distribution network serving customers in Hong Kong and China.

Marketing and Customers

The Company’s product is typically sold to major ginseng brokers in Hong Kong and a limited number of smaller customers. The marketing efforts to customers in Hong Kong and the Far East, primarily mainland China, are conducted through the Company’s wholly-owned subsidiary CNT HK. During the years ended December 31, 2010, 2009 and 2008, the Company had sales of approximately 57%, 63% and 87%, respectively, to its major customers located in Hong Kong. Although the Company believes that a limited number of customers will continue to represent a significant portion of its total revenue, the Company does not consider itself economically dependent upon any single customer or combination of customers due to the existence of other potential brokers capable of purchasing the Company’s supply.

Transfer prices between all the companies in the group are determined based on estimated world market prices at the transaction dates. Market prices are established with reference to various ginseng brokers in Hong Kong and comparable sales to third parties.

12

Manufacturing/Processing

Canadian farming and processing operations, conducted through the Company’s wholly-owned subsidiary, CNT Farms., consist of farming, including cultivation, harvesting, washing and drying the root prior to export or sale to the local market. Substantially, all of the Company’s sales during 2010, 2009 and 2008 involved the sale of bulk root.

The industry as a whole has a limited supply of seed for new plantings. The supply of seeds comes from those picked each year from mature plants under cultivation. The seeds are living embryos that must be planted in the following year. Normal industry practice is to store the seed for only one year so its limited shelf life can cause some barriers for future planting.

Manufacturing and processing of value-added products in North America is contracted out to third party manufacturers through the Company’s wholly-owned subsidiary CNTN in Canada. Activities in recent years have consisted of a limited amount of sales of herbal health products to distributors in Canada

Canada and Foreign Sales/Assets

During 2010, the Company earned $3.8 million in sales in Canada, and $5.1 million in sales in Hong Kong and China.

During 2009, the Company earned $1.5 million in sales in Canada, and $5.4 million in sales in Hong Kong and China.

During 2008, the Company earned $1.2 million in sales in Canada, and $8.0 million in sales in Hong Kong and China.

As at December 31, 2010, 2009 and 2008, 100% of the Company’s long lived assets were in Canada.

Staffing

As at December 31, 2010, the Company employed 9 salaried full-time people in its operations world-wide. The Company may hire up to 39 persons for seasonal work in the ginseng farms and for production work in its processing facilities.

Seasonality

The Company’s business is highly seasonal, with harvesting and planting activities typically occur during the last two quarters of each year. Historically, fall harvests were sold primarily during the first two quarters of the subsequent year leading to significant seasonal variations in the volume of sales, inventory and crop costs.

ORGANIZATIONAL STRUCTURE

As at December 31, 2005, Road King, through its subsidiary Herb King International Limited, held about 77% of the Company’s issued and outstanding common shares and 100% of the Company’s issued and outstanding preferred shares. On September 1, 2006, Herb King exercised its right to convert 10,399,149 preferred shares of the Company into an equivalent number of common shares, thereby raising its holdings of the Company’s common shares to 84%. On December 7, 2006, Road King distributed its entire holding of the common shares of the Company to its shareholders by way of a special interim dividend. As a result of the distribution, Wai Kee Holdings Limited (“Wai Kee”) became the largest single shareholder of the Company and holds about 46% of the Company’s issued and outstanding common shares as at December 31, 2010, up from the 38% held as at December 31, 2009 and December 31, 2008. Wai Kee is a Hong Kong based publicly traded company, with its core business in investment holdings.

13

As of December 31, 2010 the Company has the following wholly-owned subsidiaries:

a)	Chai-Na-Ta Farms Ltd. (“CNT Farms”) incorporated on February 28, 1994 in British Columbia, Canada
b)	Chai-Na-Ta International Ltd. ("CNTI") (Inactive) incorporated on January 18, 1994 in Barbados
c)	Chai-Na-Ta (Asia) Ltd. (“CNTA”) (Inactive) incorporated on October 26, 1992 in Barbados
d)	CNT Nominees Limited. (Inactive) incorporated on August 6, 1999 in the British Virgin Islands
e)	CNT Trading (Asia) Limited. (Inactive) incorporated on October 17, 2000 in the British Virgin Islands
f)	CNT Trading (Hong Kong) Limited (“CNT HK”) incorporated on October 13, 1999 in Hong Kong
g)	Unique Formulations Inc. (“UF”) (Inactive) incorporated on April 21, 1993 in Oregon, USA
h)	CNT Nutraceuticals Ltd. (“CNTN”) Incorporated on February 3, 2004 in British Columbia, Canada

An organisation chart of the Company and its affiliates is included in the exhibit (8.1).

PROPERTY, PLANT AND EQUIPMENT

The Company's executive office is located in rented premises of approximately 3,000 square feet at Unit 100 - 12051 Horseshoe Way, Richmond, British Columbia V7A 4V4. The Company also has an office located on its farm sites in Otterville, Ontario.

The Company holds 163 gross acres of farmland under lease in Ontario (Table No. 4) and owns a 50 acre farm near Otterville, Ontario. All Ontario harvested roots have been processed in on-site facilities, thereby reducing transportation and handling costs. Currently, 140 acres of the agricultural land held by the Company is under cultivation for the production of ginseng.

The Company cultivates ginseng primarily on leased land. Agricultural land is normally leased for a five year period and land rentals range from $300 - $400 per year per acre.

Table No. 4
Agricultural Land Leases
Name	Location	Gross Acreage	Expiration
Ash	Norwich, Ontario	5.3	12/31/2011
Grim	Otterville, Ontario	77.5	12/31/2012
Maitz	Norwich, Ontario	31.5	12/31/2011
Pargauskas	Norwich, Ontario	48.7	12/31/2012
		163.0

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ITEM 5  OPERATING AND FINANCIAL REVIEW AND PROSPECTS 

Forward-looking statements

The Statements contained in this report which are not historical facts, including, but not limited to, certain statements found under this section, are forward-looking statements that involve a number of risks and uncertainties. The actual results of the future events described in such forward-looking statements could differ materially from those stated in such forward-looking statements. Among the factors that could cause actual results to differ materially are the risks and uncertainties discussed in this report, and the uncertainties set forth from time to time in the Company’s filings with the Securities and Exchange Commission, and the other public statements. Such risks and uncertainties include, without limitation, seasonality, interest in the Company’s products, general economic conditions, consumer trends, competition, the effect of governmental regulation, prices, yields, availability of new working capital, quality of the Company’s harvest, and successful implementation of new products. This section should be read in conjunction with the Company’s Consolidated Financial Statements included as Item 17 of this report. These consolidated financial statements have been prepared in accordance with Canadian generally accepted accounting principles (Canadian GAAP), which in the case of these financial statements, conform in all material respects with those in the United States (US GAAP), except as disclosed in note 20 to the consolidated financial statements.

OPERATING RESULTS

Fiscal year ended 12/31/2010 compared with year ended 12/31/2009

Revenue increased 29% to $8,951,000 in 2010 from $6,941,000 in 2009. The Company’s average selling price increased to $10.25 per pound compared to $8.50 per pound in 2009 and the Company’s volume of sales increased by 8% in 2010 to 858,000 pounds compared to 798,000 pounds in 2009. The 2010 sales included 510,000 pounds of root harvested in 2009 and 2010 and 348,000 pounds of root harvested in 2008 and earlier periods. The 2009 and 2010 harvested root achieved an average selling price of $13.00 per pound while the 2008 and early harvested root achieved lower selling prices. Since the selling price on 2008 and earlier harvests was lower than 2009 and 2010 harvest, this resulted in a lower average selling price than the Company would have achieved in 2010. The increase in volume was primarily due to customers not taking delivery of the 348,000 pounds of inventory from 2008 and earlier harvests until 2010. The Company expects that the volume of sales will be significantly lower in 2011 as all of the inventory from 2009 and earlier harvests has been sold and all that remains is 480,000 pounds of inventory harvested in 2010. However, the Company expects that total revenue will approximate the current year’s amount as there will be a significant increase in the average selling price due to an increase in quality of the Company’s product and an overall increase in market demand.

Cost of goods sold was 86% of sales revenue in 2010 compared to 95% of sales revenue in 2009; therefore gross margin was 14% of revenue in 2010 compared to 5% in 2009. In 2010, the gross margin was primarily due to the increased average selling price on inventory sold from the 2010 harvest. In 2009, the gross margin was primarily due to the fulfillment of a contract made with a Canadian customer for the supply of ginseng prongs and fibres.

The Company harvested 545,000 pounds of root in 2010, an increase of 22% from 446,000 pounds in 2009. In 2010, the Company harvested 125 acres for a yield of 4,345 pounds per acre, while in 2009 the Company harvested 127 acres for a yield of 3,513 pounds per acre. The increase in yield is a result of enhanced crop management techniques and because virtually all of the crops harvested in 2010 harvest were five years old.

15

The Company recorded a write-down on the ginseng crops that will be harvested in 2011 of $170,000 for the year ended December 31, 2010 due to frost damage which reduced the expected yield and thus reduced their net realizable value. The net realizable value of the ginseng crops was estimated based on the estimated yield and quality of the crops upon harvest, accumulated costs, estimated additional costs required to bring the crops to harvest and current and projected selling prices.

The Company recorded a write-down on its long-term ginseng crops of $450,000 for the year ended December 31, 2009 to reduce their carrying value to their net realizable value. In 2009, the Company also reversed the $500,000 write-down recorded during the year ended December 31, 2008 on its ginseng crops harvested in 2009 as the net realizable value of those crops increased primarily due to an increase in the selling price of ginseng at the end of 2009 compared to 2008. The Company also recorded a write-down of $64,000 on ginseng fibres from prior harvests resulting in a new carrying value of zero as the ability of the Company to sell these specific ginseng fibres is uncertain.

Selling, general and administrative expenses decreased to $957,000 in 2010 compared to $1,458,000 in 2009. For 2010, this amount included $151,000 in retention bonuses for management and staff of which $4,000 was paid and $147,000 was accrued as at December 31, 2010. For 2009, the selling, general and administrative expenses included $530,000 in costs related to the wind-up of the farming operations in British Columbia. Therefore, taking into account these non-recurring items, the Company reduced its other selling, general and administrative expenses by 13% to $806,000 in 2010 from $928,000 in 2009. The Company expects that its total selling, general and administrative expenses will increase in 2011 due to the accrual of retention bonuses.

The interest on short-term debt was zero in 2010 as all short-term borrowings were repaid in 2009 and no new facilities were required subsequent to 2009.

Interest on long-term debt increased to $383,000 in 2010 compared to $283,000 in 2009. The increase in interest on long-term debt is primarily due to its debt facilities converting to a fixed interest rate on March 1, 2010 compared to a variable interest rate, which was at historically low levels, throughout 2009. Since the Company has repaid the remaining amount of the loan in early 2011, interest on long-term debt in 2011 is expected to be minimal.

The Company had other non-operating income of $812,000 for the year ended December 31, 2010 which included $69,000 in foreign exchanges gains, $591,000 in gains on the disposal of property, plant and equipment, $138,000 in government supplement payments net of participating fees and miscellaneous non-operating income of $14,000. For the year ended December 31, 2009, the Company had other non-operating income of $2,079,000 which included $470,000 in foreign exchange gains, $611,000 in gains on the disposal of property, plant and equipment, $995,000 in government supplement payments net of participating fees and miscellaneous non-operating income of $3,000. Government supplement payments were from the Canadian federal government and were received as part of a program to aid agriculture businesses for losses of their margin relative to historic prices. The payment received for the year ended December 31, 2009 was from the 2007 program year and the payment received for the year ended December 31, 2010 was also from the 2007 program year as the Company filed an adjustment to its initial submission. The Company does not expect a similar payment to be received for the 2008 and 2009 program years and considers these payments non-recurring.

In 2010, the Company achieved net earnings of $759,000, or $0.02 basic and diluted earnings per share compared to the 2009 net earnings of $669,000, or $0.02 basic and diluted loss per share.

In order to conform Canadian GAAP to US GAAP, the net earnings would be increased by $502,000 for the year ended December 31, 2010 reflecting the differences in the accounting for interest, financial instruments and write-downs of inventory. As a result of these adjustments, the net earnings under US GAAP would have been $1,261,000 for the year ended December 31, 2010. The net earnings would be decreased by $497,000 under US GAAP for the year ended December 31, 2009 and as a result of these adjustments, the net earnings under US GAAP would have been $172,000 for the year ended December 31, 2009.

16

Fiscal year ended 12/31/2009 compared with year ended 12/31/2008

Revenue decreased 25% to $6,941,000 in 2009 from $9,232,000 in 2008. The Company’s average selling price decreased to $8.50 per pound compared to $9.50 per pound in 2008. The Company also saw a decrease of 17% in the volume of sales in 2009 compared to 2008, but this was primarily due to customers not taking delivery of all the inventory they had contracted to purchase from the 2008 harvest. Ginseng prices remained at historic low levels in 2009 but there was a modest recovery of ginseng prices at the end of 2009.

Cost of goods sold was 95% of sales revenue in 2009 compared to 129% in 2008. In 2009, the gross margin was primarily due to the fulfilment of a contract made with a Canadian customer for the supply of ginseng prongs and fibres. The remaining ginseng root sales in both years were made after the inventory had been written down to its net realizable value in the previous year resulting in a minimal margin on inventory sales. The impairment in the value of inventory and ginseng crops to their estimated net realizable value are accounted for as a part of cost of goods sold which caused cost of goods sold to be in excess of revenue in 2008.

The Company harvested 446,000 pounds of root in 2009, a decrease of 55% from 988,000 pounds in 2008 when the Company harvested roots from both Ontario and British Columbia. The Company harvested 340,000 pounds in Ontario in 2008 so there was a 31% increase in total yield in Ontario in 2009. In 2009, the Company harvested 127 acres in Ontario resulting in an average yield of 3,513 pounds per acre. In 2008, the Company harvested a total of 350 acres in British Columbia and Ontario, with an average yield of 2,824 pounds per acre including 126 acres in Ontario with an average yield of 2,700 pounds per acre. The higher average yield in 2009 was mainly due to the harvest of 70 acres of five-year-old roots. The Company’s production cost decreased to $10 per pound in 2009 compared to $12 per pound in 2008 also due to the higher yields per acre.

The Company recorded a write-down on its long-term ginseng crops of $450,000 for the year ended December 31, 2009 to reduce their carrying value to their net realizable value. The net realizable value of the ginseng crops was estimated based on the estimated yield and quality of the crops upon harvest, accumulated costs, estimated additional costs required to bring the crops to harvest and current and projected selling prices. In 2009, the Company also reversed the $500,000 write-down recorded during the year ended December 31, 2008 on its ginseng crops harvested in 2009 as the net realizable value of those crops increased primarily due to an increase in the selling price of ginseng at the end of 2009 compared to 2008. The Company also recorded a write-down of $64,000 on ginseng fibres from prior harvests resulting in a new carrying value of zero as the ability of the Company to sell these specific ginseng fibres is uncertain.

The Company recorded a write-down on its 2008 harvest inventory of $2,498,000 for the year ended December 31, 2008 to reduce their carrying value to their net realizable value. The net realizable value of the inventory was estimated based on purchase commitments received for inventory on hand. Because of the historic low prices in 2008, a $500,000 write-down was recorded on the expected 2009 harvest which was subsequently reversed in 2009.

Gross margin was 5% of sales revenue in 2009 compared to a gross loss of 29% in 2008 due to the ginseng root sales in both years being made after the inventory had been written down to its net realizable value in the previous year and due to the write-downs on inventory and ginseng crops.

17

Selling, general and administrative expenses totalled $1,458,000 in 2009 including $530,000 in costs related to the wind-up of the farming operations in British Columbia. The remaining $928,000 in expenses was a 4% decrease from the $969,000 in expenses incurred during 2008.

Interest on short-term debt decreased to $37,000 in 2009 compared to $144,000 in 2008. The decrease in interest on short-term debt is primarily due to decreases in the short-term borrowings throughout 2009 compared to 2008.

Interest on long-term debt decreased to $283,000 in 2009 from $426,000 in 2008. The decrease in interest on long-term debt is primarily due to decreases in the Hong Kong Interbank Offered Rate (“HIBOR”) and London Interbank Offered Rate (“LIBOR”) throughout 2009.

The Company had other non-operating income of $2,079,000 for the year ended December 31, 2009 which included $470,000 in foreign exchanges gains, $611,000 in gains on the disposal of property, plant and equipment, $995,000 in government supplement payments net of participating fees and miscellaneous non-operating income of $3,000. For the year ended December 31, 2008, the Company had other non-operating losses of $446,000 which included $769,000 in foreign exchanges losses, $256,000 in gains on the disposal of property, plant and equipment, $64,000 in government supplement payments net of participating fees and miscellaneous non-operating income of $3,000. Government supplement payments were from the Canadian federal government and were received as part of a program to aid agriculture businesses for losses of their margin relative to historic prices. The payment received for the year ended December 31, 2009 was from the 2007 program year. The Company does not expect a similar payment to be received for the 2008 and 2009 program years and considers these payments non-recurring.

In 2009, the Company incurred net earnings of $669,000, or $0.02 basic and diluted earnings per share compared to the 2008 net loss of $4,670,000, or $0.13 basic and diluted loss per share. The net earnings in 2009 were mainly due to gains on the disposal of assets of $611,000, foreign exchange gains of $470,000 and government supplements of $995,000.

Reconciling from Canadian GAAP to US GAAP, the net earnings would be decreased by $497,000 for the year ended December 31, 2009 reflecting the differences in the accounting for interest, financial instruments and write-downs of inventory. As a result of these adjustments, the net earnings under US GAAP would have been $172,000 for the year ended December 31, 2009. The net loss would be decreased by $4,000 under US GAAP for the year ended December 31, 2008 and as a result of these adjustments, the net loss under US GAAP would have been $4,666,000 for the year ended December 31, 2008.

LIQUIDITY AND CAPITAL RESOURCES

Fiscal year ended 12/31/2010 compared with year ended 12/31/2009

In 2010, the cash provided by operations was $3,325,000 compared to $3,647,000 in 2009. The Company’s cash as at December 31, 2010 was $2,659,000 compared to a balance of $2,488,000 at December 31, 2009, an increase of $171,000. The slight increase in cash in 2010 was due to the $645,000 in proceeds from the disposition of property, plant and equipment.

As of December 31, 2010, the Company had received $1,479,000 in deposits from customers. These deposits are on orders that should be fulfilled in the first half of 2011.

18

The working capital position of the Company at December 31, 2010 was a surplus of $8,751,000 compared to a surplus of $8,948,000 at December 31, 2009, a decrease of $197,000. This decrease in working capital is due to the repayment of long-term debt of $3,712,000 in 2010.

On September 1, 2009 the Company agreed to an extension of an existing HK$51,500,000 loan facility from More Growth Finance Limited (“More Growth”). The Company has repaid HK$21,125,000 ($2,820,000) and US$878,000 ($892,000) during the year ended December 31, 2010 bringing the balance due down to US$3,000,000 ($2,984,000) at December 31, 2010. The Company incurred $383,000 (2009 - $283,000) of interest which has been included in interest on long-term debt on the statement of operations and deficit. The remaining portion of the loan is due on September 1, 2012; however, subsequent to the end of the reporting period, the Company repaid the remaining balance of the loan.

Capital expenditures of $86,000 during 2010 were for the purchase of equipment for the Ontario farming operations. During the year, the Company sold excess sunshade and equipment in Ontario and received proceeds from their disposition of $645,000.

The Company believes that its existing cash resources, together with the cash generated from future sales of inventory and the current borrowings, will be sufficient to meet its working capital and operating requirements for the next twelve months.

As at December 31, 2010, the Company had the contractual obligations and commercial commitments outlined in the chart below:

Table No. 5
Contractual Obligations

Contractual Obligations	Payments Due by Period
		Total		Less Than  One Year		1-3 Years		After 3 Years
Long-term Debt (1)	$	3,005,000	$	3,005,000	$	0	$	0
Operating Leases (2)	$	110,000	$	88,000	$	22,000	$	0
Agricultural Land Leases (3)	$	91,000	$	52,000	$	39,000	$	0
Total Contractual Obligations	$	3,206,000	$	3,145,000	$	61,000	$	0

(1)	Long-term debt includes the loan from More Growth at a rate of 6.25% and also includes accrued interest and estimated future interest payments.
(2)	Operating leases comprise of the Company’s long-term leases of equipment, office facilities and vehicles.
(3)	Agricultural land leases comprise of the Company’s land rentals in Ontario for the cultivation of ginseng. The Company’s commitment to agriculture land rentals for 2012 can be alleviated upon completion of the harvest of the ginseng crops in 2011 and after notification has been given to the respective landlords.

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The following commitments are not included in the Contractual Obligations table above:

The Company is committed to maintaining its ginseng crops from the time of initial planting to the time of harvesting, which usually takes three to four years. The Company expects that it will harvest all its remaining ginseng crops in 2011. The cost of maintaining these crops is financed through the sale of inventory and available bank borrowings. This commitment is not included in the Contractual Obligations table.

The Company does not have any off balance sheet arrangements as defined in Item 5(e) of Form 20-F.

The Company has no significant purchase obligations as at December 31, 2010.

Fiscal year ended 12/31/2009 compared with year ended 12/31/2008

In 2009, the cash surplus from operations was $3,647,000 compared to $303,000 in 2008. The Company’s cash as at December 31, 2009 was $2,488,000 compared to a balance of $192,000 at December 31, 2008, an increase of $2,296,000. The increase in cash from operations in 2009 was due to the decrease in crop cost expenditures as the Company only had 392 acres of ginseng crops under cultivation in 2009 compared to 742 acres under cultivation in 2008 including 224 acres in British Columbia.

The working capital position of the Company at December 31, 2009 was a surplus of $8,948,000 compared to a surplus of $5,456,000 at December 31, 2008. The increase in working capital is primarily due to the reduction in expenditures on ginseng crops and the proceeds from the disposition of property, plant, and equipment in British Columbia that had been reclassified as assets held for sale in 2008.

At December 31, 2009, the Company had a $500,000 revolving demand operating loan, with an interest rate of prime plus 3.75% per annum, with a Canadian chartered bank. Based on its positive cash position, the Company could not draw on this facility as of December 31, 2009. The loan availability reduced to zero effective March 31, 2010. The Company also fully repaid a $2,000,000 term loan, with an interest rate of prime plus 1.875% per annum, with the same Canadian chartered bank during the year ended December 31, 2009. The Company incurred interest of $37,000 (2008 - $144,000) on these loans for the year which has been included in interest on short-term debt on the statement of operations.

As of December 31, 2009, the Company had received $3,301,000 in deposits from customers. These deposits are primarily on orders that were fulfilled in 2010.

On August 18, 2006, the Company established a four year term loan facility of HK$54,700,000 from a company formerly under common control of which HK$3,200,000 was repaid on August 31, 2009. As of September 1, 2009 the Company negotiated an extension of the remaining HK$51,500,000 loan facility. Under the terms of the extension, the Company will be required to repay HK$3,300,000 ($446,000) by August 31, 2010, and HK$16,700,000 ($2,254,000) by August 31, 2011. The remaining amount ($4,245,000) is to be repaid by August 31, 2012 in apportionments of HK$1,250,000 and US$3,878,000. The loan is unsecured and bears interest at 1.75% per annum over the HIBOR or LIBOR through February 28, 2010 after which it will bear interest at a flat rate of 6.25% for the duration of the loan. For the year ended December 31, 2009, the Company incurred $283,000 (2008 - $425,000, 2007 - $626,000) of interest which has been included in interest on long-term debt on the statement of operations and deficit.

Capital expenditures of $145,000 during 2009 were mainly for the purchase of dryers, equipment and a vehicle in Ontario. During the fourth quarter of 2009, the Company sold its land, buildings and all remaining production assets located near Kamloops, British Columbia. This, along with the sale of the other assets of the British Columbia operations sold earlier in the year, resulted in $2,379,000 in proceeds from the disposition of assets held for sale for the year ended December 31, 2009.

20

CRITICAL ACCOUNTING POLICIES AND SIGNIFICANT ESTIMATES

The significant accounting policies are outlined within Note 3 to the consolidated financial statements. Some of those accounting policies require the Company to make estimates and assumptions that affect the amounts reported by the Company. The following items require the most significant judgement and involve complex estimation.

Inventory

The Company periodically reviews the carrying value of inventory to determine if write-downs are required to state the inventory at the lower of cost and net realizable value. The determination of net realizable value reflects management’s best estimate of the expected selling price of the roots as well as consideration of qualitative factors such as size, shape, colour and taste. During the harvest period each autumn, the Company grades its inventory based on these qualitative factors and receives bids from its various customers for each inventory lot. For inventory that is contracted to a customer, the agreed selling price is used to determine net realizable value. For any inventory not yet contracted, the Company estimates its net realizable value primarily based on the most recent unaccepted bids from customers. The carrying value of inventory also reflects management’s expectation that the inventory will eventually be sold. Although management does not believe that additional provisions are required to align the carrying value of certain inventory with its net realizable values, future events may indicate that the inventory is not saleable or that such inventory is not saleable at prices above carrying value.

Ginseng crops

The Company uses the full absorption costing method to value its ginseng crops and periodically reviews their carrying value for evidence of impairment. Included in the cost of crops are seed, labour, applicable overhead, interest and supplies required to bring them to harvest. The determination of impairment requires complex calculations and significant management estimation with respect to future costs to bring crops to harvest and expectations as to the yield and quality of ginseng roots harvested. The estimation process is further complicated by the relatively long growing cycle of three to four years and the fact that roots remain underground. The market price of harvested ginseng roots is also difficult to determine due to industry-wide factors such as the variable worldwide supply each harvest season and foreign exchange rate fluctuations, and due to specific qualitative factors to each grower such as the size, shape, color, taste, and quality of the roots harvest. There is no set price for harvested ginseng roots, the yield from each garden will vary and the perceived market value will vary along with it. Although the Company’s assumptions reflect management’s best estimates, future events may result in materially different outcomes with respect to the recoverability of ginseng crop costs and the time required bringing the crops to harvest.

Income Taxes

The Company estimates its income taxes in each of the jurisdictions that it operates. The process involves estimating the current income tax exposure, together with assessing temporary differences from different treatment of items for tax and accounting purposes. These differences result in future tax assets and liabilities that are included in the consolidated balance sheet to the extent that a net future income tax asset or liability exists. The valuation of any future income tax assets or liabilities is reviewed quarterly and adjusted, if necessary, by use of a valuation allowance to reflect the estimated realizable amount. The process of determining if a valuation allowance is necessary includes estimates of the recoverability of inventory and ginseng crops as detailed above and an estimate of future interest expense. Future events may result in a materially different outcomes than is estimated with respect to the recoverability of both inventory and ginseng crops.

21

RECENT ACCOUNTING PRONOUNCEMENTS

Pronouncements from the United States

In January 2010, the FASB issued ASU 2010-06, "Improving Disclosures about Fair Value Measurements," which amends ASC 820 to add new requirements for disclosures about transfers into and out of Level 1 and 2 measurements and separate disclosures about purchases, sales, issuances and settlements relating to Level 3 measurements. This ASU also clarifies existing fair value disclosure requirements about the level of disaggregation and about inputs and valuation techniques used to measure fair value. Further, this ASU amends guidance on employers' disclosures about postretirement benefit plan assets under ASC 715 to require that disclosures be provided by classes of assets instead of by major categories of assets. This standard is effective for the first reporting period (including interim periods) beginning after December 15, 2009, except for the requirement to provide the Level 3 activity of purchases, sales, issuances, and settlements on a gross basis, which will be effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. The Company adopted the required provisions of this standard during the first quarter of 2010.

Future change in accounting policies

In April 2008, the Canadian Accounting Standards Board confirmed that on January 1, 2011 Canadian GAAP will be replaced by International Financial Reporting Standards (“IFRS”) for publicly accountable enterprises. Management initiated its IFRS changeover plan in 2009 but has now suspended its changeover to IFRS and intends to convert to US GAAP instead of IFRS on January 1, 2011. Management believes that the conversion to US GAAP will be much less onerous and costly as the Company already reconciles to US GAAP annually as part of its filings with the United States Securities Exchange Commission.

ITEM 6  DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES 

DIRECTORS AND SENIOR MANAGEMENT

Directors

Table No. 6 lists as of February 28, 2011, the names of all the Directors of the Company. The Directors have served in their respective capacities since their election and will serve until the next Annual General Meeting or until a successor is duly elected, unless the office is vacated in accordance with the Articles/By-laws of the Company.

	Table No. 6
	Directors
Name	Age	Date First Elected
Dr. Eric Littley (2)	56	June, 2001
Peter Leung (1) (2)	51	August, 2001
Steven Hsieh (1)	56	February, 2002
Wilman Wong (2)	55	November, 2005
Derek Zen	58	November, 2006
Brent Lau (1)	50	November, 2006

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(1)	Member of the Audit Committee
(2)	Member of the Farm Review Committee

Dr. Eric Littley, Director of the Company, is a resident of British Columbia, Canada. Dr. Littley has a diverse background in the management of crops and plant diseases, and has extensive experience in the ginseng industry. He holds a Masters degree in Pest Management and a Ph.D. in Plant Pathology from the Centre for Pest Management at Simon Fraser University. His background includes 10 years leading the R&D efforts with Chai-Na-Ta Corp. and 7 years as a consultant to specialty crop growers in Canada and the U.S. He is currently Chair of the Department of Biological Sciences at Thompson Rivers University in Kamloops, British Columbia.

Mr. Peter Leung, Director and former Officer of the Company, is a resident of Ontario, Canada. Mr. Leung holds a Bachelor of Science degree in Pharmacy and was a former President of the Chinese Pharmaceutical Society in Ontario.

Mr. Steven Hsieh, Director of the Company, is a resident of British Columbia, Canada. Mr. Hsieh is a member of the Chartered Institute of Management Accountants, U.K., and of the Certified Financial Planners of Canada. He is in public practice as a Certified Management Accountant in Vancouver, British Columbia. Mr. Hsieh also serves as a director of Fireswirl Technologies Inc., a public company traded on the TSX Venture.

Mr. Wilman Wong, Director and Officer of the Company, is a resident of British Columbia, Canada. Mr. Wong is a fellow member of the Association of Chartered Certified Accountants and associate member of the Hong Kong Institute of Certified Public Accountants. Mr. Wong has over 20 years experience in auditing, taxation, secretarial and financial management

Mr. Derek Zen, Chairman of the Company, is a resident of Hong Kong. Mr. Zen is the executive director of Road King Infrastructure Limited since its establishment. He is also the Vice Chairman of Wai Kee Holdings Limited and the Chairman of Build King Holdings Limited – both companies listed in the Hong Kong Stock Exchange. He holds a Bachelor of Science degree in Engineering and a Master of Business Administration degree. He is a Chartered Engineer and is a member of the Institution of Civil Engineer and is a fellow member of the Institute of Quarrying, UK. Mr. Zen has over 30 years of experience in civil engineering industry.

Mr. Brent Lau, Director of the Company, is a resident of Hong Kong. Mr. Lau has previously acted as the executive director for companies listed on the Hong Kong Stock Exchange for many years. He graduated from the University of Toronto with a Bachelor of Commerce degree and has over twenty years of experience in various senior corporate administration and operation management, money lending and securities trading business.

Officers

Table No. 7 lists as of February 28, 2011 the names of all of the Executive Officers of the Company. The Executive Officers are elected annually by the Directors following the Annual General Meeting and serve until the earlier of their resignation or termination with or without cause by the Directors. Each Executive Officer has continuously served in his respective position from the date indicated in Table No. 7 unless otherwise indicated in his resume data following Table No.7.

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Table No. 7
Executive Officers
Name	Age	Title	Date First Affiliated
Wilman Wong	55	CEO & Corporate Secretary	June, 2000
Terry Luck	34	CFO	July, 2000

Mr. Wilman Wong, Chief Executive Officer/Corporate Secretary, and an Officer of the Company, is a resident of British Columbia, Canada. Mr. Wong is a fellow member of the Association of Chartered Certified Accountants and associate member of the Hong Kong Institute of Certified Public Accountants. Mr. Wong has over 20 years experience in auditing, taxation, secretarial and financial management. Mr. Wong was appointed to the position of Chief Executive Officer in May 2007.

Mr. Terry Luck, Chief Financial Officer, and an Officer of the Company, is a resident of British Columbia, Canada. Mr. Luck is a Certified General Accountant with over ten years of experience in accounting, treasury, financial management and taxation. Mr. Luck was appointed to the position of Chief Financial Officer in May 2007.

There are no arrangements or understanding between any two or more Directors or Executive Officers.

COMPENSATION

The Company has a standard arrangement for compensating its Directors for their service in their capacity as Directors. In addition, Directors may be granted stock options. Directors received compensation during the year ended December 31, 2010, for their services as a Director including committee participation and/or special assignments as described below.

The Company also grants stock options to Executive Officers and employees from time to time.

Table No. 8 lists the compensation during the year ended December 31, 2010, for Executive Officers and Directors.

Table No. 8 Director/Officer Compensation Year Ended December 31, 2010
Officer/Director		Base Salary		Option Exercise Net Market Value		Total Compensation
Wilman Wong	$	121,844	$	0	$	121,844
Terry Luck		94,926		0		94,926
Other Directors		26,750		0		26,750
Total	$	243,520	$	0	$	243,520

Option Exercise Net Market Value is computed by subtracting the cost of exercising the stock option from the market value of the respective shares of common stock on the date of exercise. There were no stock options granted to officers/directors as at December 31, 2010.

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The Company accrued $30,000 and $24,000 in retention bonuses for the Chief Executive Officer and the Chief Financial Officer, respectively, as at December 31, 2010 as part of a Company wide plan to retain management and staff through the expected final harvest in 2011 and the subsequent sale of the inventory in 2012. No other funds were set aside or accrued by the Company during the year ended December 31, 2010 to provide pension, retirement or similar benefits for Directors or Executive Officers.

The Company has entered into contractual agreements with the Executive Officers that will provide specific compensation in the event that the executive is terminated without cause. The executive will be entitled to three months written notice or equivalent severance pay in lieu of notice plus one month’s salary per full or partial fiscal year of employment. These payments are contingent on the executive accepting a one-year non-competition agreement as well as a non-disclosure agreement. The Company has no plans or arrangements in respect of remuneration received or that may be received by Executive Officers of the Company in the year ended December 31, 2010 to compensate such officers in the event of termination of employment as a result of termination with cause, retirement, or a change of responsibilities following a change of control.

BOARD PRACTICES

All directors hold office until the next annual general meeting of shareholders, which generally is in May of each calendar year, or until their respective successors are duly elected and qualified or their positions are earlier vacated by resignation or otherwise. All executive officers are appointed by the Board and serve at the pleasure of the Board.

The Audit Committee of the board of directors reviews, acts on and reports to the board of directors with respect to various auditing and accounting matters, including the selection of our auditors, the scope of the annual audits, fees to be paid to the auditors, the performance of our independent auditors and our accounting practices. The Audit Committee consists of Mr. Steven Hsieh, Mr. Brent Lau and Mr. Peter Leung.

The Farm Review Committee of the board of directors reviews and reports to the board with respect to Ontario Farm operations, including land selection recommendation and site inspection, farm policy and plant science techniques recommendation; quarterly review of farm operations to ensure acceptable cultural maintenance practices are maintained. The Committee consists of Mr. Peter Leung, Mr. Eric Littley and Mr. Wilman Wong.

The Company does not currently have a remuneration or compensation committee.

EMPLOYEES

During 2010, the Company employed 9 persons on a full time basis and 41 persons on an hourly basis. During 2009, the Company employed 12 persons on a full time basis and 57 persons on an hourly basis. During 2008, the Company employed 19 persons on a full time basis and 156 persons on an hourly basis. The Company is not a party to any material labour contract or collective bargaining agreement.

SHARE OWNERSHIP

Table No. 9 lists the share ownership in the Company by the Executive Officers and Directors as at February 28, 2011.

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Table No. 9
Share Ownership of Directors/Officers as at February 28, 2009
Officer/Director	Title	Approximate Number of Shares
Derek Zen	Director	(1)
Wilman Wong	CEO/Corporate Secretary	-
Terry Luck	CFO	-
Other Directors		2,000

(1)      12,858,415 and 3,168,000 common shares of the Company are owned by ZWP Investments Limited and Groove Trading Limited, respectively, of which Derek Zen is a Director. Derek Zen holds 253,728 common shares of the Company.

STOCK OPTIONS

The Company has a total of 785,000 shares reserved for issue under the Plan. As of February 28, 2011, no options to purchase shares were outstanding while 159,268 options remain available for issuance under the Plan.

In May 1997, the shareholders approved a stock option plan (“the Plan”), and all outstanding options to directors, officers and service providers were brought within the purview of the Plan. Shareholder approval will no longer be required for each grant, as has been the case in the past, but will continue to be required as regards to any amendment to the Plan.

The Plan has restrictions as follows:

1.	the number of shares reserved for issuance pursuant to stock options granted to insiders shall not exceed 10% of the outstanding issue;
2.	there shall not be issued to insiders, within a one-year period, a number of shares exceeding 10% of the outstanding issue; or
3.	there shall not be issued to any one insider and such insider’s associated parties, within a one year period, a number of shares exceeding 5% of the outstanding issue.

ITEM 7  MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS 

MAJOR SHAREHOLDERS

The Company is a publicly owned corporation, the shares of which are owned by Canadian residents, US residents, and residents of other countries. As of December 31, 2010 (latest record date), the following persons and/or companies held 5% or more beneficial interest in the Company's outstanding common stock.

ZWP Investments Limited (1)	12,858,415 (37.06%) common shares
Groove Trading Limited (1)	3,168,000 (9.13%) common shares
Hover Limited	7,011,318 (20.21%) common shares

(1)      ZWP Investments Limited and Groove Trading Limited are subsidiaries of Wai Kee.

The authorized capital of the Company consists of an unlimited number of shares of common stock without par value of which 34,698,157 were issued/outstanding as of December 31, 2010 and 21 million Series 1 non-voting, non-cumulative preferred shares convertible into common shares on a 1:1 basis of which none were issued/outstanding at December 31, 2010.

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All of the authorized shares of the Company's common stock are of the same class and, once issued, rank equally as to dividends, voting powers, and participation in assets. Holders of common stock are entitled to one vote for each share held of record on all matters to be acted upon by the shareholders. Holders of common stock are entitled to receive such dividends as may be declared from time to time by the Board of Directors, at its discretion, out of funds legally available therefore.

Upon liquidation, dissolution or winding up of the Company, holders of common stock are entitled to receive on a pro rata basis the assets of the Company, if any, remaining after payments of all debts and liabilities, including settlement of the preferred shares. No shares have been issued subject to call or assessment. There are no pre-emptive or conversion rights and no provisions for redemption or purchase for cancellation, surrender, or sinking or purchase funds.

Provisions as to the modification, amendment of variation of such shareholder rights or provisions are contained in the Canada Business Corporation Act. Unless the Canada Business Corporation Act, or the Company's By-Law’s otherwise provide, any action to be taken by a resolution of the members may be taken by an ordinary resolution or by a vote of a majority or more of the shares represented at the shareholders' meeting.

The Canada Business Corporation Act contains provisions, which require a "special resolution" for effecting certain corporate actions. Such a "special resolution" requires a two-thirds vote of shareholders rather than a simple majority for passage. Special resolutions are required to effect a "fundamental change" as provided in Section 173 of the Canada Business Corporation Act; in addition, special resolutions would be required on an amalgamation, on a continuation, and on a voluntary dissolution.

RELATED PARTY TRANSACTIONS

The Company pays management fees to Wai Kee for performing sales, accounting and administrative services for CNT Trading (Hong Kong) Limited, a subsidiary of the Company. Wai Kee is a Hong Kong based publicly traded company which owns 46% of the shares of the Company and has a director in common with the Company. The Company paid management fees of $63,000 for the year ended December 31, 2010 (2009 - $114,000, 2008 - $103,000) of which $10,000 remains outstanding as at December 31, 2010 (2009 - $17,000, 2008 - $20,000) and is included in accounts payable and accrued liabilities on the consolidated balance sheet.

ITEM 8  FINANCIAL INFORMATION 

CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION

Financial Statements

The Company's audited consolidated financial statements are set forth under Item 17.

Legal Proceedings

None.

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Export Sales

Information regarding our export sales is provided under ‘Segmented Reporting’ in the notes to the Consolidation Financial Statements under Item 17. Export sales are comprised of the external revenue from the Hong Kong and People’s Republic of China geographic region.

Dividend Policy

Holders of our common shares and preferred shares are entitled to receive such dividends as may be declared from time to time by our board of directors. There can be no assurance that any dividend will be declared, or if declared, what the amounts of dividend will be or whether such dividends, once declared, will continue for any future period.

ITEM 9  THE OFFER AND LISTING 

On December 7, 2005, the Company was notified by the TSX that the eligibility of the Company’s continued listing on the TSX was being reviewed. The Company was granted 120 days to comply with the requirement for continued listing. On March 31, 2006, the Toronto Stock Exchange suspended the Company’s shares from trading and delisted the common shares on April 28, 2006 as the Company had not met the continued listing requirements of the Exchange.

The Company's common stock trades on the NASDAQ Stock Market in the United States, having the trading symbol "CCCFF" (formerly "CJGPF") and CUSIP #15745J-10-6. The Company's common stock commenced trading on the NASDAQ Stock Market in October 1992 and was delisted on April 14, 1999 for not meeting the listing requirements. The Company’s common stocks commenced trading on the NASDAQ OTC Bulletin Board in April 1999 retaining the trading symbol “CCCFF”.

The following tables set forth the high/low prices on NASDAQ OTC Bulletin Board for shares of the Company's common stock for each of the last five years, each of the quarters in the two most recently completed financial years and monthly for each of the most recent six months.

NASDAQ Stock High/Low Prices
	(US Cents)
Year Ended	High	Low
NASDAQ OTCBB:
12/31/2010	5.0¢	1.2¢
12/31/2009	6.0¢	0.2¢
12/31/2008	5.0¢	1.0¢
12/31/2007	12.0¢	2.0¢
12/31/2006	20.0¢	3.0¢
12/31/2005	50.0¢	11.0¢

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Quarter Ended	High	Low
NASDAQ OTCBB:
12/31/2010	5.0¢	2.0¢
09/30/2010	5.0¢	1.2¢
06/30/2010	1.5¢	0.2¢
03/31/2010	1.8¢	0.2¢
12/31/2009	6.0¢	1.0¢
09/30/2009	6.0¢	0.4¢
06/30/2009	2.0¢	3.0¢
03/31/2009	2.0¢	3.9¢
Month Ended	High	Low
02/28/2011	5.0¢	4.0¢
01/31/2011	5.0¢	4.0¢
12/31/2010	5.0¢	3.0¢
11/30/2010	2.0¢	4.5¢
10/31/2010	2.0¢	2.0¢
09/30/2010	5.0¢	2.0¢

The Company's common stock is issued in registered form and the following information is taken from the records of Computershare located in Vancouver, British Columbia, Canada, the registrar and transfer agent for the common stock.

On February 28, 2011, the shareholders' list for the Company's common stock showed 1,298 registered shareholders and depositories with 34,698,157 shares outstanding of which 5% are held in Canada, 31% in the United States and 64% are held internationally. Based upon the number of proxy statements and annual reports requested by shareholders and brokers for the Company's last annual shareholders' meeting and other research, the Company believes it has in excess of 3,000 beneficial owners of its common stock.

The Company's common stock is not registered to trade in the United States in the form of American Depository Receipts (ADR's) or similar certificates.

ITEM 10  ADDITIONAL INFORMATION 

MEMORANDUM AND ARTICLES OF ASSOCIATION

Directors

(a)      A director who is, in any way, directly or indirectly interested in a proposed contract or transaction with the Company shall disclose the nature and extent of his interest at a meeting of the directors in accordance with the provisions of the Canada Business Corporations Act. A director shall not vote in respect of any contract or transaction with the Company in which he is interested, and if he shall do so, his vote shall not be counted but he may be counted in the quorum present at the meeting at which such vote is taken.

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(b)	Subject to any unanimous shareholder agreement, the directors shall be paid such remuneration for their services as the board may from time to time determine.
(c)	Without limiting the borrowing powers of the Company as set forth in the Canada Business Corporations Act, the board may from time to time in such amounts and on such terms as it deems expedient to borrow money upon the credit of the Company.
(d)	No person shall be qualified for election as a director if he is less than 18 years of age and there are no provisions with respect to the retirement of a director or the non-retirement of directors under an age limit requirement.
(e)	A director need not be a shareholder but a majority of the directors shall be resident Canadians.

Common Shares and Preferred Shares

The share capital of the Company shall consist of an unlimited number of Common Shares and an unlimited number of Preferred Shares, of which 21,000,000 shares are designated Preferred Shares, Series 1, all without par value, having the rights, privileges, restrictions and conditions hereinafter described:

The Common Shares shall confer on the holders thereof and shall be subject to the following rights, privileges, conditions and restrictions:

(a)	Voting – The holders of the Common Shares shall be entitled to receive notice of and to attend all meetings of the shareholders of the Company and shall have one vote for each common share held at all meetings of the shareholders of the Company, except for meetings at which only holders of another specified class or series of shares of the Company are entitled to vote separately as a class or series;
(b)	Dividends – Subject to the rights, privileges, conditions and restrictions of the Preferred Shares and any of its series as designated by the directors from time to time, the holders of the Common Shares shall, in the absolute discretion of the directors, be entitled to receive and the Company shall pay out of monies of the Company properly applicable to the payment of dividends, those dividends as may be declared from time to time in respect of the Common Shares; and
(c)	Dissolution – Subject to the rights, privileges, conditions and restrictions of the Preferred Shares and any of its series as designated by the directors from time to time, the holders of the Common Shares shall be entitled to receive the remaining property of the Company on dissolution.

The Preferred Shares shall confer on the holders thereof and shall be subject to the following rights, privileges, conditions and restrictions:

(a)	Series – The directors may issue Preferred Shares in one or more series;
(b)	Designation – The directors may by resolution amend the articles of the Company to fix the number of shares in, and to determine the designation of the shares of, each series of Preferred Shares;

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(c)	Directors to Attach Rights – The directors may by resolution amend the articles of the Company to determine the rights, privileges, restrictions and conditions attaching to the shares of each series of Preferred Shares;
(d)	Cumulative Dividends – Where shares of one or more series of Preferred Shares are entitled to cumulative dividends, and where any cumulative dividends in respect of a series of Preferred Shares are not paid in full, the shares of all series of Preferred Shares entitled to cumulative dividends shall participate rateably in respect of accumulated dividends in accordance with the amounts that would be payable on those shares if all the accumulated dividends were paid in full;
(e)	Rateable Participation – Where amounts payable are not paid in full on a winding-up, or on the occurrence of any other event as a result of which the holders of the shares of all series of Preferred Shares are then entitled to a return of capital, the shares of all series of Preferred Shares shall participate rateably in a return of capital in respect of the Preferred Shares in accordance with the amounts that would be payable on the return of capital if all amounts so payable were paid in full;
(f)	No Priority – No rights, privileges, restrictions or conditions attached to a series of Preferred Shares shall confer on the series priority over another series of Preferred Shares then outstanding respecting:

i.	dividends, or
ii.	a return of capital:

(1)	on a winding-up, or
(2)	on the occurrence of another event that would result in the holders of all series of Preferred Shares being entitled to a return of capital;

(g)

Additions, Changes and Removals – A directors’ resolution pursuant to paragraphs (a), (b) or (c) may only be passed prior to the issue of shares of the series to which the resolution relates, and after the issue of shares of that series, the number of shares in, the designation of and the rights, privileges, restrictions and conditions attached to, that series may be added to, changed or removed only pursuant to applicable provisions of the Canada Business Corporations Act;

(h)

No Right to Vote – Except as expressly provided in the rights, privileges, restrictions or conditions which the directors may determine or attach to any series of Preferred Shares, shares of a series of Preferred Shares shall not confer on the holders thereof any right to notice of or to be present at or to vote, either in person or by proxy, at any meeting of the shareholders of the Company other than a separate meeting of the holders of the Preferred Shares, or of the holders of a series of the Preferred Shares, as the case may be.

In addition to the rights, privileges, restrictions and conditions attaching to the Preferred Shares of the Company as a class, the Preferred Shares, Series 1 of the Company shall have the following rights and be subject to the following restrictions, conditions and limitations:

(a)      Non-Voting – The holders of the Preferred Shares, Series 1 shall not, as such, be entitled to receive notice of or to attend meetings of the shareholders of the Company nor shall they have any voting rights for the election of directors or for any other purpose (except where the holders of a specified class are entitled to vote separately as a class as provided in the Canada Business Corporations Act).

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(b)

Dividends – The holders of the Preferred Shares, Series 1 shall be entitled to receive, and the directors of the Company shall declare and the Company shall pay thereon, out of the moneys of the Company properly applicable to the payment of dividends, a non-cumulative dividend on each Preferred Share, Series 1 equal to any dividend the board of directors of the Company may from time to time declare and the Company pay on each Common Share, and such dividends on the Preferred Shares, Series 1 shall be declared and paid at the same time as the declaration and payment of such dividends on the Common Shares.

(c)

Conversion

(i)	A holder of Preferred Shares, Series 1 shall be entitled, at such holder’s option, at any time and from time to time, to have all or any of the Preferred Shares, Series 1 registered in the name of such holder on the books of the Company converted into Common Shares as the same shall be constituted at the time of conversion upon the basis of one Common Share for each Preferred Share, Series 1 so converted; provided that, on conversion of any Preferred Shares, Series 1, the holders thereof shall be entitled to receive any declared and unpaid dividends thereon which are payable to the holders of Preferred Shares, Series 1 of record on a date prior to the date on which such conversion is effective pursuant to Section 3 (c)(ii) below;
(ii)	The conversion right provided for herein may be exercised by notice in writing given to the Company at its registered office accompanied by the certificate or certificates representing the Preferred Shares, Series 1 in respect of which the holder thereof desires to exercise such right of conversion and such notice shall be executed by the person registered on the books of the Company as the holder of the Preferred Shares, Series 1 in respect of which such right is being exercised or by such holder’s duly authorized attorney and shall specify the number of such shares which the holder desires to have converted. The conversion shall be deemed to take effect upon the date which the said certificate or certificates shall be surrendered to the Company at its registered office accompanied by the said notice unless such date be a Saturday, Sunday or a holiday, in which event it shall take effect on the next business day. If a part only of the Preferred Shares, Series 1 represented by any certificate is converted, a new certificate for the balance shall be issued without charge by the Company;
(iii)	Any Preferred Shares, Series 1 issued and outstanding as of 5:00 p.m. (Vancouver time) on that date which is 10 years following issuance shall, at such time, automatically be converted into Common Shares on the basis one Common Share for each Preferred Share, Series 1 then issued and outstanding, and after such time, a holder of such automatically converted Preferred Shares, Series 1 shall cease to have any rights as a shareholder in respect of such shares other than the right to receive anydeclared and unpaid dividends thereon which are payable to the holders of Preferred Shares, Series1 of record as of a date prior to the date of such automatic conversion. Such holder shall be entitledto receive from the Corporation, without charge, a certificate representing the Common Sharesresulting from such automatic conversion of such Preferred Shares, Series 1;
(iv)	All Common Shares resulting from any conversion provided for herein shall be fully paid and non-assessable;and
(v)	In the event that the Preferred Shares, Series 1 or the Common Shares are at any time subdivided, consolidatedor changed into a greater or lesser number of shares of the same or another class, an appropriateadjustment shall be made in the rights and conditions attached to the Preferred Shares,Series1 so as to maintain the relative rights of the holders of those shares.

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(d)      Liquidation, Dissolution and Winding-up – In the event of the liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, the holders of the Preferred Shares, Series 1 shall be entitled to receive, before any distribution of any part of the assets of the Corporation among the holders of the Common Shares or any other shares in the capital of the Corporation ranking junior to the Preferred Shares, Series 1, for each Preferred Share, Series 1, the amount of C$0.6804 and any dividends declared thereon and unpaid, and following such distribution, the holders of the Preferred Shares, Series 1 shall be entitled to share equally and rateably without preference or distinction on a per share basis with the holders of Common Shares or other shares in the capital of the Company in the distribution of the remaining property and assets of the Company.

Change Rights of Shareholders

The directors may by resolution to amend the articles of the Company to change the rights of shareholders. According to Canada Business Corporations Act, such amendment requires approval by a special resolution of shareholders.

Meetings of Shareholders

An Annual General Meeting must be held once every financial year for the purpose of considering the financial statements and reports, electing directors, appointing auditors and for the transaction of other business as may be brought before the meeting. The board, the chairman of the board or the president shall have power to call a special meeting of shareholders at any time.

Notice of the time and place of each meeting of shareholders must be given no less than 21 days, nor more than 50 days, before the date of each meeting to each director, to the auditors and to each shareholder who at the close of business on the record date, if any, for notice is entered in the securities register as the holder of one or more shares carrying the right to vote at the meeting.

Rights to Own Securities

There are no limitations on the rights of non-resident or foreign shareholders to hold or exercise voting rights.

Except as provided in the Investment Canada Act, there are no limitations under the applicable laws of Canada or by our charter or other constituent documents of our Company on the right of foreigners to hold or vote Common Shares of other securities of our Company.

The Investment Canada Act will prohibit implementation, or if necessary, require divestiture of an investment deemed “reviewable” under the Investment Canada Act by an investor that is not a “Canadian” as defined in the Investment Canada Act (a “non-Canadian”), unless after review the Minister responsible for the Investment Canada Act (“the Minister”) is satisfied that the “reviewable” investment is likely to be of net benefit to Canada. An investment in our Common Shares by a non-Canadian would be reviewable under the Investment Canada Act if it was an investment to acquire control of our Company and the value of our assets was $5 million or more. A non-Canadian would be deemed to acquire control of our company for the purposes of the Investment Canada Act if the non-Canadian acquired a majority of our outstanding Common Shares (or less than a majority but controlled our company in fact through the ownership of one-third or more of our outstanding common shares) unless it could be established that, on the acquisition, our Company was not controlled in fact by the acquirer through the ownership of such Common Shares. Certain transactions in relation to our Common Shares would be exempt from review under the Investment Canada Act, including, among other, the following:

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1.	Acquisition of Common Shares by a person in the ordinary course of that person’s business as a trader or dealer in securities;
2.	Acquisition of control of our Company in connection with the realization of security granted for a loan or other financial assistance and not for any purpose related to the provisions of the Investment Canada Act; and
3.	Acquisition of control of our Company by reason of an amalgamation, merger, consolidation or corporate reorganization following which the ultimate direct or indirect control of our company, through the ownership of voting interests, remains unchanged.

The Investment Canada Act was amended with the World Trade Organization Agreement to provide for special review thresholds for “WTO Investors” of countries belonging to the World Trade Organization, among others, nationals and permanent residents (including “WTO Investor controlled entities” as defined in the Investment Canada Act). Under the Investment Canada Act, as amended, an investment in our Common Shares by WTO Investors would be reviewable only if it was an investment to acquire control of our Company and the value of our assets was equal to or greater than a specified amount (the “Review Threshold), which is published by the Minister after its determination for any particular year.

Change in Control

There are no provisions in our Articles that would have the effect of delaying, deferring or preventing a change in control of our Company, and that would operate only with respect to a merger, acquisition or corporate restructuring involving the Company.

MATERIAL CONTRACTS

There is no material contract entered into for the two years immediately preceding publication of this document.

EXCHANGE CONTROL

There are no government laws, decrees or regulations in Canada which restrict the export or import of capital or which affect the remittance of dividend, interest or other payments to non-resident holders of our common shares. Any remittances of dividends to United States residents and to other non-residents are, however subject to withholding tax. See “Taxation” below.

TAXATION

The following is a fair summary of the material Canadian federal income tax consequences generally applicable in respect of the common stock. The tax consequences to any particular holder of common stock will vary according to the status of that holder as an individual, trust, corporation or member of a partnership, the jurisdiction in which that holder is subject to taxation, the place where that holder is resident and, generally, according to that holder's particular circumstances. This summary is applicable only to holders who are resident in the United States, have never been resident in Canada, deal at arm's length with the Company, hold their common stock as capital property and who will not use or hold the common stock in carrying on business in Canada.

This summary is based upon the provisions of the Income Tax Act of Canada and the regulations thereunder (collectively, the "Tax Act") as at the date of the Annual Report, publicly-announced proposals to amend the Tax Act as at the date of this Annual Report and the current administrative practices of the Canada Revenue Agency . This summary does not take into account provincial income tax consequences. The summary assumes that the publicly announced proposals will be enacted as proposed with the effective dates set out therein; otherwise, the summary assumes that there will be no other changes in law whether by judicial or legislative action.

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This summary is of a general nature only and is not exhaustive of all possible income tax consequences. It is not intended as legal or tax advice to any particular holder of common stock and should not be so construed. Each holder is encouraged to consult their own tax advisor with respect to the income tax consequences applicable to him in his own particular circumstances.

Disposition of Common Stock. Under the Tax Act, a gain from the sale of common stock by a non-resident will not be subject to Canadian tax, provided the shareholder (and/or persons who do not deal at arm's length with the shareholder) have not held 25% or more of the shares of any class of the Company's stock at any time in the five years preceding the disposition. Generally, the Canada-United States Tax Convention (the "Tax Convention") will exempt from Canadian taxation any capital gain realized by a resident of the United States unless:

• their value is derived principally from real property in Canada;

• the holder was resident in Canada for 120 months during any period of 20 consecutive years preceding the disposition and the common stocks were owned by him when he ceased to be a resident in Canada; or

• they form part of the business property of a permanent establishment that the holder has or had in Canada within the 12 months preceding the disposition.

Dividend. In the case of any dividends paid to non-residents, the Canadian tax is withheld by the Company, which remits only the net amount to the shareholder. By virtue of Article X of the Tax Convention, the rate of tax on dividends paid to residents of the United States is generally limited to 15% of the gross dividend (or 5% in the case of certain corporate shareholders owning at least 10% of the Company's voting shares). In the absence of the treaty provisions, the rate of Canadian withholding tax imposed on non-residents is 25% of the gross dividend. Stock dividends received by non-residents from the Company are taxable by Canada as ordinary dividends at the amount by which the paid up capital of the Company is increased for the shares issued as dividends.

The Tax Convention generally exempts from Canadian withholding tax dividends paid to a religious, scientific, literary, educational or charitable organization exclusively administering a pension, retirement or employee benefit fund or plan, if the organization is resident in the United States and is exempt from income tax under the laws of the United States.

DOCUMENTS ON DISPLAY

The documents concerning our Company may be viewed at the offices of our corporate solicitor, Stikeman Elliott, at Suite 1700, Park Place, 666 Burrard Street, Vancouver, BC V6C 2X8, during normal office hours.

ITEM 11  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 

The Company’s revenue is derived principally from the sale of ginseng roots to a limited number of customers that are concentrated in Asian markets. In order to manage its credit risk, the Company carefully monitors credit terms, investigates credit history and grants credit to customers with established relationships or an acceptable credit rating. Payments or deposits are usually received before shipments of inventory. Letters of credit may be used, or inventory may be held as security until payment is received, when such relationships have not been established. The Company identifies Canada as the primary economic environment in which it operates and uses the CDN$ as its functional currency. A minor portion of the Company’s revenues are denominated in Hong Kong dollars as well as a loan which is denominated in Hong Kong dollars.

35

The Company monitors its exposure to foreign exchange risk and balances its foreign currency holdings to reduce exposures to any one currency by repatriating any excess funds. The Company may also from time to time utilize foreign exchange contracts to hedge against exchange risks. The Company has a US$ net liability exposure of US$554,000 ($551,000) as at December 31, 2010. Based on this net exposure an increase in the spot CDN$/US$ exchange rate of $0.10 would result in a foreign exchange loss of $55,000 while a decrease of $0.10 would result in a corresponding foreign exchange gain. The Company also has foreign exchange exposure related to the foreign exchange adjustment of the deficit of self-sustaining foreign operations which is included in accumulated other comprehensive income. As a result, an increase in the spot CDN$/US$ exchange rate of $0.10 would result in other comprehensive income of $195,000 while a decrease of $0.10 would result in a corresponding other comprehensive loss. Cumulatively, an increase in the spot CDN$/US$ exchange rate of $0.10 would result in an increase to comprehensive income of $140,000 while a decrease of $0.10 would result in a corresponding decrease to comprehensive income.

The Company’s revenues and earnings are also impacted by the world price of ginseng root which is determined by reference to a number of factors including the supply and demand for North American ginseng root, negotiations between buyer and seller, the quality and aesthetic characteristics of the root and the relative strength of the CDN$ to the currency used by the Company’s customers. A percentage change in the market price of ginseng root will tend to have a corresponding impact on the revenues reported by the Company. An increase in the selling price by $1 per pound will increase the Company’s net earnings by approximately $545,000 (based on the 2010 harvest of 545,000 pounds) and a decrease in the selling price by $1 per pound would have an equally negative impact on net earnings.

The interest income from cash and cash equivalents and the interest expense from borrowings under credit facilities are subject to interest rate changes and therefore interest income and interest expense will fluctuate directly with changes in interest rates and the amount of cash and cash equivalents and borrowing outstanding at any given time. The Company’s long-term debt reverted to a fixed interest rate effective February 28, 2010 and therefore, the Company is not exposed to any material risk in interest rate changes.

ITEM 12  DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES 

Not applicable.

PART II

ITEM 13  DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES 

Not applicable.

ITEM 14 MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

Not applicable.

36

ITEM 15  CONTROLS AND PROCEDURES 

Management notes that, while they believe the Company’s disclosure controls and procedures are designed to provide a reasonable level of assurance that they are effective, they do not expect that the Company’s disclosure controls and procedures will prevent all errors and fraud. A control system, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

Management, with the participation of the Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this report, being the year ended December 31, 2010. Based on such evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures are effective at the reasonable assurance level as of December 31, 2010 to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the United States Securities and Exchange Commission (“SEC”) rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosures.

Management’s Report on Internal Control over Financial Reporting

The management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) or 15d-15(f)). This internal control system was designated to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

Management, with the participation of the Chief Executive Officer and Chief Financial Officer conducted an assessment of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2010 based on the criteria in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, the management has concluded that the Company’s internal control over financial reporting as of December 31, 2010 is effective.

This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this annual report.

There are no changes in the Company’s internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonable likely to material affect, the Company’s internal control over financial reporting.

ITEM 16  RESERVED 

ITEM 16A AUDIT COMMITTEE FINANCIAL EXPERT 

The Company’s Board of Directors has determined that Mr. Steven Hsieh, Chairman of the Audit Committee and independent director, qualifies as “audit committee financial expert” pursuant to this Item 16A of the Form 20-F.

37

ITEM 16B   CODE OF ETHICS

On May 6, 2005, the Company has adopted a code of ethics that applies to its employees, including its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions.

The Company undertake to provide to any person without charge, upon request, a copy of such code of ethics in either of the following ways:

By mail to:	Chai Na Ta Corp.
	Unit 100 – 12051 Horseshoe Way,
	Richmond, British Columbia V7A 4V4

By e-mail to: info@chainata.com

ITEM 16C PRINCIPAL ACCOUNTANT FEES AND SERVICES 

Deloitte & Touche LLP acts as the Company’s principal independent auditor for the years ended December 31, 2010 and 2009. The following table discloses the aggregate fees billed for professional services rendered by Deloitte & Touche LLP for the years ended December 31, 2010 and 2009.

	2010 CDN’000	2009  CDN’000
Audit Fees (1)	126	126
Audit -related Fees	-	-
Tax Fees (2)	-	19
All Other Fees	-	-
Total	126	145

(1)	Audit fees consist of fees for the annual audit of the Company’s consolidated financial statements and fees for reviews of interim financial statements as well as fees for services relating to the review of documents filed with the SEC up to February 28, 2011.
(2)	Tax fees consist of fees billed for withholding tax refund.

Audit Committee Pre-Approval Policies and Procedures

The Audit Committee is authorized by the Board of Directors to review the performance of the Company’s external auditors, approve in advance the provision of services other than auditing and to consider the independence of the external auditors, including the range of services provided in the context of all consulting services bought by the Company. The Audit Committee is authorized to approve any non-audit services or additional work with the Chairman of the Audit Committee deems as necessary and will notify other members of the Audit Committee of such non-audit work.

38

ITEM 16D EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDITCOMMITTEES

Not applicable

ITEM 16E PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATEDPURCHASERS

Not applicable

ITEM 16F  CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT 

Not applicable

ITEM 16G  CORPORATE GOVERNANCE 

Not applicable

PART III

ITEM 17  FINANCIAL STATEMENTS 

The Company's consolidated financial statements are stated in CDN$s and are prepared in accordance with Canadian GAAP, the application of which, in the case of the Company, conforms in all material respects for the periods presented with US GAAP, except as referred to in footnotes to the audited consolidated financial statements.

Audited Consolidated Financial Statements and Financial Statement Schedules:

Report of Independent Registered Chartered Accountants, dated March 15, 2011

Consolidated Balance Sheets as at December 31, 2010 and December 31, 2009

Consolidated Statements of Operations and Deficit for the years ended December 31, 2010, December 31, 2009 and December 31, 2008.

Consolidated Statements of Comprehensive Income for the years ended December 31, 2010, December 31, 2009 and December 31, 2008.

Consolidated Statements of Accumulated Other Comprehensive Income for the years ended December 31, 2010, December 31, 2009 and December 31, 2008.

Consolidated Statements of Cash Flows for the years ended December 31, 2010, December 31, 2009 and December 31, 2008.

39

Consolidated Statements of Crop Costs for the years ended December 31, 2010, December 31, 2009 and December 31, 2008.

Notes to the Consolidated Financial Statements.

ITEM 18  FINANCIAL STATEMENTS 

The Registrant has elected to provide financial statements pursuant to Item 17.

ITEM 19  EXHIBITS 

1.1.	Articles of Incorporation, effective August 12, 1981 (incorporated by reference from our Form 20-F and Form 6K )
1.2.	Certificate of Name Change, dated September 7, 1994 (incorporated by reference from our Form 20-F and Form 6K)
2.1	Instruments defining the rights of holders of registered equity or debt securities – refer to Exhibit 1.1 above.
4.1	Private Placement Share Subscription Agreement, dated April 20, 2000, by the Company and Road King Infrastructure Limited (incorporated by reference from our Form 20-F Annual Report filed on May 30, 2001)
4.2	Employment Agreement, dated May 5, 2000, by the Company and Gerald A. Gill. (incorporated by reference from our Form 20-F Annual Report filed on May 30, 2001)
4.3	Conversion Agreement, dated May 8, 2000, by the Company, Chai-Na-Ta Farms Ltd., John Hancock Life Insurance Company and Herb King International Limited. (incorporated by reference from our Form 20-F Annual Report filed on May 30, 2001)
4.4	Partnership Agreement between Chai-Na-Ta Farms Ltd. and 499599 B.C. Ltd. (incorporated by reference from our Form 20-F Annual Report filed on May 31, 1996).
4.5	Joint Venture Agreement between Chai-Na-Ta Farms Ltd. and the Skeetchestn Indian Band (incorporated by reference from our Form 20-F Annual Report filed on May 31, 1996).
4.6	Share Purchase Agreement between the Company and LTRD Biotech Limited. (incorporated by reference from our Form 20-F Annual Report filed on May 26, 2003)
8.1	Organization chart of the Company and its affiliates.
12.1	Certification of the CEO under Section 302 of the Sarbanes-Oxley Act of 2002.
12.2	Certification of the CFO under Section 302 of the Sarbanes-Oxley Act of 2002.
13.1	Certification of CEO and CFO as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

40

SIGNATURE PAGE

The registrant hereby certifies that it meets all the requirements for filing on Form 20-F and that it has duly caused and authorised the undersigned to sign this registration statement (annual report) on its behalf.

Chai-Na-Ta Corp.
Registrant
By:	“TERRY LUCK”
	Terry Luck, Chief Financial Officer

Dated: March 29, 2011

41

Report of Independent Registered Chartered Accountant

and

Consolidated Financial Statements of:

CHAI-NA-TA CORP.

(Stated in Canadian Dollars)
December 31, 2010, 2009 and 2008

	Deloitte & Touche LLP
	2800 – 1055 Dunsmuir Street
	4 Bentall Centre
	P.O. Box 49279
	Vancouver BC V7X 1P4
	Canada
	Tel: 604-669-4466
	Fax: 604-685-0395
	www.deloitte.ca

Report of Independent Registered Chartered Accountants

To the Shareholders of Chai-Na-Ta Corp.

We have audited the accompanying consolidated financial statements of Chai-Na-Ta Corp. and subsidiaries (the “Company”), which comprise the consolidated balance sheets as at December 31, 2010 and December 31, 2009, and the consolidated statements of operations and deficit, comprehensive income, accumulated other comprehensive income, cash flows and crop costs for each of the years in the three-year period ended December 31, 2010, and notes to the consolidated financial statements

Management's Responsibility for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with Canadian generally accepted accounting principles, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with Canadian generally accepted auditing standards and the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained in our audits is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of Chai-Na-Ta Corp. and subsidiaries as at December 31, 2010 and December 31, 2009 and the results of their operations and cash flows for each of the years in the three-year period ended December 31, 2010 in accordance with Canadian generally accepted accounting principles.

Other Matters

On March 29, 2011, we reported separately to the shareholders of Chai-Na-Ta Corp. on our audits, conducted in accordance with Canadian generally accepted auditing standards, on financial statements for the same period, prepared in accordance with Canadian generally accepted accounting principles, but which excludes a footnote providing a reconciliation of accounting principles generally accepted in Canada to those of the United States of America as it relates to Chai-Na-Ta Corp. and includes a footnote with a supplemental discussion of differences between Canadian GAAP and US GAAP.

(Signed) Deloitte & Touche LLP

Independent Registered Chartered Accountants
March 29, 2011
Vancouver, Canada

CHAI-NA-TA CORP.
Consolidated Balance Sheets
(Stated in thousands of Canadian Dollars)

As at December 31	Note		2010		2009
ASSETS
Current assets
Cash		$	2,659	$	2,488
Accounts receivable			27		13
Inventory	10		4,839		6,668
Ginseng crops	4,10		3,149		3,898
Prepaid expenses			78		87
			10,752		13,154
Ginseng crops	4,10		-		2,154
Prepaid expenses			15		28
Property, plant and equipment	5		2,232		2,513
		$	12,999	$	17,849

LIABILITIES
Current liabilities
Accounts payable and accrued liabilities		$	522		$	459
Customer deposits	6		1,479			3,301
Current portion of long-term debt	7		-			446
			2,001			4,206
Long-term debt	7		2,984			6,499
Total liabilities			4,985			10,705
SHAREHOLDERS' EQUITY
Share capital	8		38,246			38,246
Contributed surplus	8		338			338
Accumulated other comprehensive income			917			806
Deficit			(31,487	)		(32,246	)
			(30,570	)		(31,440	)
Total equity			8,014			7,144
		$	12,999		$	17,849

Going concern (Note 2)
Commitments, contingencies and guarantees (Note 14)

See accompanying notes to the consolidated financial statements

APPROVED BY THE BOARD

"DEREK ZEN"	"WILMAN WONG"
Derek Zen	Wilman Wong
Chairman	Chief Executive Officer

CHAI-NA-TA CORP.
Consolidated Statements of Operations and Deficit
(Stated in thousands of Canadian Dollars except per share amounts)

Years ended December 31	Note		2010			2009			2008
Revenue		$	8,951		$	6,941		$	9,232
Cost of goods sold
Cost of inventory sold			7,433			6,452			8,826
Shipping and handling fees			61			107			93
Write-down of inventory and ginseng crops	10		170			14			2,998
			7,664			6,573			11,917
Gross margin (loss)			1,287			368			(2,685	)
Selling, general and administrative expenses	11		957			1,458			969
Interest on short-term debt			-			37			144
Interest on long-term debt	7		383			283			426
			1,340			1,778			1,539
Operating loss			(53	)		(1,410	)		(4,224	)
Other income (loss)	12		812			2,079			(446	)
NET EARNINGS (LOSS)			759			669			(4,670	)
Deficit, beginning of year			(32,246	)		(32,915	)		(28,245	)
DEFICIT, END OF YEAR		$	(31,487	)	$	(32,246	)	$	(32,915	)
Basic and diluted earnings (loss) per share	3(i)	$	0.02		$	0.02		$	(0.13	)
Weighted average number of common shares used to calculate basic and diluted earnings (loss) per share (in thousands)			34,698			34,698			34,698

See accompanying notes to the consolidated financial statements

CHAI-NA-TA CORP.
Consolidated Statements of Comprehensive Income
(Stated in thousands of Canadian Dollars)

Years ended December 31		2010		2009		2008
Net earnings (loss)	$	759	$	669	$	(4,670	)
Other comprehensive income (loss)		111		364		(460	)
Comprehensive income (loss)	$	870	$	1,033	$	(5,130	)

CHAI-NA-TA CORP.
Consolidated Statements of Accumulated Other Comprehensive Income
(Stated in thousands of Canadian Dollars)

Years ended December 31		2010		2009		2008
Balance, beginning of year	$	806	$	442	$	902
Other comprehensive income (loss):
Adjustments as a result of foreign exchange translation of self-sustaining subsidiaries		111		364		(460	)
Balance, end of year	$	917	$	806	$	442

See accompanying notes to the consolidated financial statements

CHAI-NA-TA CORP.
Consolidated Statements of Cash Flows
(Stated in thousands of Canadian Dollars)

Years ended December 31		2010			2009			2008
Net inflow (outflow) of cash related to the following activities:
Operating Activities
Net earnings (loss)	$	759		$	669		$	(4,670	)
Items included in net earnings (loss) not affecting cash:
Cost of ginseng crops sold		7,367			5,906			8,548
Write-down of inventory and crop costs		170			14			2,998
Gain on the disposal of property, plant and equipment		(591	)		(611	)		(256	)
Non-cash realized foreign exchange (gains) losses		(117	)		(410	)		782
Depreciation and amortization expense		8			10			9
Changes in non-cash operating assets and liabilities:
Accounts receivable		(14	)		302			(259	)
Inventory		29			(16	)		(9	)
Prepaid expenses		22			(3	)		(68	)
Accounts payable and accrued liabilities		50			(161	)		(744	)
Customer deposits		(1,822	)		848			66
Ginseng crop expenditures		(2,536	)		(2,901	)		(6,094	)
		3,325			3,647			303
Financing Activities
Bank indebtedness		-			(3,060	)		(450	)
Repayment of long-term debt		(3,712	)		(527	)		(155	)
		(3,712	)		(3,587	)		(605	)
Investing Activities
Purchase of property, plant and equipment		(86	)		(145	)		(94	)
Proceeds from the disposition of property, plant and equipment		645			2,386			273
		559			2,241			179
Effect of exchange rate changes on cash		(1	)		(5	)		8
Net increase (decrease) in cash		171			2,296			(115	)
Cash, beginning of year		2,488			192			307
Cash, end of year	$	2,659		$	2,488		$	192
Supplemental information:
Other cash flows:
Interest paid	$	548		$	176		$	1,289
Non-cash investing and financing activities:
Property, plant and equipment purchases financed through equipment purchase loan agreements	$	-		$	-		$	45

See accompanying notes to the consolidated financial statements

CHAI-NA-TA CORP.
Consolidated Statements of Crop Costs
(Stated in thousands of Canadian Dollars)

Years ended December 31	Note		2010		2009			2008
Depreciation		$	305	$	307		$	592
Farm equipment operating costs			226		234			556
Interest on long-term debt			-		3			5
Land rental costs			130		202			368
Mulch and fertilizer			647		881			1,499
Office and insurance costs			52		86			166
Plant science			4		6			7
Salaries and wages			1,229		1,272			2,858
Seed			-		43			68
Small tools and supplies			14		19			36
Warehouse and dryer operations			234		196			534
			2,841		3,249			6,689
Balance, beginning of year			6,052		7,486			11,395
			8,893		10,735			18,084
Less:
Cost of crop harvested			5,574		4,630			10,233
Cost of seeds sold and available for sale			-		103			-
Crop costs reallocated to assets held for sale			-		-			(135	)
Write-down of ginseng crops	10		170		(50	)		500
Balance, end of year			3,149		6,052			7,486
Less: current portion			3,149		3,898			2,722
		$	-	$	2,154		$	4,764

See accompanying notes to the consolidated financial statements

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

1. NATURE OF OPERATIONS

The Company operates North American ginseng farms in Ontario, Canada, on which ginseng root is planted, cultivated and harvested. The Company sells ginseng in its primary markets of Hong Kong and China, and to a lesser extent Canada and the United States of America, through its wholly-owned subsidiaries. The Company also sells ginseng-based value-added products in Canada although they do not represent a significant percentage of sales.

The Company is publicly traded with no single shareholder holding a majority of the Company’s common shares. The largest shareholder of the Company is Wai Kee Holdings Limited (“Wai Kee”), a publicly traded Hong Kong based company, which owns 46% (2009, 2008 - 38%) of the shares of the Company.

2. GOING CONCERN

The Company did not plant new crops in 2009 or 2010 and is expecting to cease operations in their current form after completing the harvest in 2011 and the sale of the inventory from that harvest in 2012. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. For the year ended December 31, 2010, the Company had an operating loss of $53,000 and net earnings of $759,000 and has an accumulated deficit of $31,487,000 as at December 31, 2010 along with positive working capital of $8,751,000 and net cash inflows for the year of $171,000. Management anticipates there will be positive cash inflows from operations for 2011 and 2012.

3. SIGNIFICANT ACCOUNTING POLICIES

These consolidated financial statements, expressed in thousands of Canadian dollars, have been prepared in accordance with Canadian generally accepted accounting principles (“Canadian GAAP”). Management will convert to United States generally accepted accounting principles (“US GAAP”) effective January 1, 2011. The accounting standards that will materially affect the Company’s reported financial position and results of operations along with a reconciliation of Canadian GAAP to US GAAP are disclosed in Note 20.

These consolidated financial statements reflect the following significant Canadian GAAP accounting policies:

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

(a) Basis of presentation

These consolidated financial statements include the accounts of the Company and those of its subsidiaries. All significant intercompany transactions and balances have been eliminated.

At December 31, 2010, the Company's effective ownership interests in these companies were as follows:

Subsidiaries
Chai-Na-Ta Farms Ltd.	100%
Chai-Na-Ta International Ltd. (Inactive)	100%
Chai-Na-Ta (Asia) Ltd. (Inactive)	100%
CNT Nominees Limited (Inactive)	100%
CNT Nutraceuticals Ltd.	100%
CNT Trading (Asia) Limited (Inactive)	100%
CNT Trading (Hong Kong) Limited	100%
Unique Formulations, Inc. (Inactive)	100%

The Company’s foreign subsidiaries are considered to be self-sustaining foreign operations. Accordingly, assets and liabilities are translated at exchange rates in effect at the balance sheet date while revenues and expenses are translated at average exchange rates prevailing during the year. The resulting translation adjustment is included in accumulated other comprehensive income until there is a reduction in the net investment.

(b) Revenue recognition

Sales of goods are recognized when persuasive evidence of an arrangement exists, delivery has occurred, title and risk have passed to the customer, the sales price is fixed and determinable, and collectibility is reasonably assured.

The above conditions are generally satisfied when the goods are delivered to the end customers or to the wholesale distributor. In instances when the above criteria are not satisfied, revenue is deferred until all conditions required for recognition of revenue are met.

(c) Financial instruments

The Company has designated its cash, bank indebtedness and foreign exchange forward contracts as held-for-trading, which are measured at fair market value with changes in fair value recorded in earnings. Accounts receivable are classified as loans and receivable which are measured at amortized cost. Accounts payable, accrued liabilities and long-term debt are classified as other liabilities, which are measured at amortized cost.

The Company is required to classify and disclose the fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy shall have the following levels:

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

Level 1 – valuation based on quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 – valuation techniques based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3 – valuation techniques using inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The fair value hierarchy requires the use of observable market inputs whenever such inputs exist. A financial instrument is classified to the lowest level of the hierarchy for which a significant input has been considered in measuring fair value. The required disclosures are included in Note 18.

(d) Cash

Cash consists of cash on hand and deposits in banks.

(e) Inventory

Inventory is valued at the lower of average cost and net realizable value. The determination of net realizable value reflects management’s best estimate of the expected selling price of the roots as well as consideration of qualitative factors such as size, shape, colour and taste. The carrying value of inventory also reflects management’s expectation that the inventory will eventually be sold. Inventory written down to its estimated net realizable value can subsequently be written up to the lesser of its new estimated net realizable value or original cost.

(f) Ginseng crops

The Company uses the full absorption costing method to value its ginseng crops. Included in crop costs are seeds, labour, applicable overhead, interest and supplies as per the consolidated statement of crop costs. Common costs are allocated in each period based on the total number of acres under cultivation during the period.

The carrying value of ginseng crops is reviewed on a regular basis for any impairment in value, using management’s best estimate as to expected future market values, yields and costs to harvest. Ginseng crops which include an impairment in value can subsequently have that impairment reversed upon a change in the factors used in management’s estimate of value.

Crop costs related to the acreage harvested and sold have been charged to cost of sales.

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

(g) Property, plant and equipment and depreciation

Property, plant and equipment are recorded at cost less accumulated depreciation. Depreciation is provided on a straight-line basis over the following periods except as noted below:

Buildings	20 years
Dryers and related works	20 years
Computer equipment and software	4 years
Furniture and fixtures	10 years
Machinery and equipment	10 years
Sunshade	10 years
Vehicles	8 years
Pavement	12.5 years

Property, plant and equipment are reviewed on a regular basis for impairment upon the occurrence of events or changes in circumstances which indicate that the net book value of the assets may not be recoverable based on estimated undiscounted future cash flows generated by their use. To the extent not recoverable, impaired assets are written down to their fair value. All property, plant and equipment are classified as assets held for use as at December 31, 2010.

(h) Income taxes

The Company accounts for income taxes using the asset and liability method. Under this method, future income taxes are recorded for the temporary differences between the financial reporting basis and tax basis of the Company’s assets and liabilities, and for losses and other deductions carried forward. Future tax assets and liabilities are measured using substantively enacted tax rates expected to apply in the years in which such temporary differences or losses and other deductions carried forward are expected to be recovered or settled. A valuation allowance is recognized to the extent that the recoverability of future income tax assets is not considered likely.

(i) Earnings (loss) per common share

Basic earnings (loss) per share is computed by dividing net earnings (loss) attributable to common shareholders by the weighted average number of common shares outstanding for the period. Diluted earnings (loss) per share reflects the potential dilution of common shares by including other common share equivalents in the weighted average number of common shares outstanding for a period, if dilutive. Common share equivalents consist of convertible preferred shares and the incremental number of shares issuable upon the exercise of stock options.

A reconciliation of net loss per common share and the weighted average shares used in the earnings per share calculations for 2010, 2009 and 2008 is as follows:

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

		Net Earnings	Thousands of		Earnings
		(Loss)	Shares		(Loss)
		(numerator)	(denominator)		Per Share
2010
Basic and Diluted	$	759	34,698	$	0.02
2009
Basic and Diluted	$	669	34,698	$	0.02
2008
Basic and Diluted	$	(4,670)	34,698	$	(0.13)

The Company had no stock options outstanding as at December 31, 2010, 2009 or 2008.

(j) Stock–based compensation plans

The Company has established a policy for the recognition, measurement and disclosure of stock-based compensation and other stock-based payments made in exchange for goods and services. The policy requires that all stock-based awards made to employees and non-employees be measured and recognized using a fair value based method.

(k) Foreign exchange forward contracts

The Company periodically enters into foreign exchange forward contracts to manage foreign exchange risk associated with future debt repayments denominated in foreign currencies. Realized and unrealized gains and losses resulting from changes in the market value of these contracts are recorded as other income unless they meet specified criteria to qualify as a hedging instrument under Canadian GAAP. The Company has not had any contracts that meet the criteria for hedging instruments during the three years ended December 31, 2010.

(l) Use of estimates

The presentation of financial statements in accordance with Canadian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and other disclosures as at the end of or during the reporting periods. Significant estimates are used for, but not limited to, the accounting for doubtful accounts, net realizable value of inventory, crop costs, depreciation on property, plant and equipment, valuation allowance on future income taxes, accrued liabilities and contingencies. Actual results may differ from these estimates.

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

4. GINSENG CROPS

Ginseng plants reach maturity and can be harvested at the end of their third year of growth. However, the Company may allow crops to mature longer to allow for higher yields and additional seed harvests. Costs accumulated relating to the expected harvest in the next year are classified as current assets. At December 31, 2010, total area under cultivation and management is 140 acres. A breakdown of acreage by year planted is as follows:

Year planted	Number of acres
2006	31
2008	109
	140

5. PROPERTY, PLANT AND EQUIPMENT

	2010
			Accumulated			Net Book
		Cost	Depreciation			Value
Land	$	171	$	-	$	171
Buildings		1,220		378		842
Dryers and related works		602		213		389
Computer equipment and software		82		77		5
Furniture and fixtures		203		191		12
Machinery and equipment		3,151		2,545		606
Sunshade		1,414		1,296		118
Vehicles		201		136		65
Pavement		47		23		24
	$	7,091	$	4,859	$	2,232

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

	2009
				Accumulated		Net Book
		Cost		Depreciation		Value
Land	$	171	$	-	$	171
Buildings		1,220		317		903
Dryers and related works		602		183		419
Computer equipment and software		82		73		9
Furniture and fixtures		203		188		15
Machinery and equipment		3,134		2,417		717
Sunshade		2,852		2,694		158
Vehicles		220		127		93
Pavement		47		19		28
	$	8,531	$	6,018	$	2,513

6. CUSTOMER DEPOSITS

Customer deposits represent deposits received from customers to secure inventory purchase commitments prior to the actual delivery of inventory.

7. LONG-TERM DEBT

		2010		2009
Term loan	$	2,984	$	6,945
Less: current portion		-		446
	$	2,984	$	6,499

On September 1, 2009, the Company agreed to a three year extension of the remaining HK$51,500,000 (equivalent to $6,561,000 at December 31, 2010) loan facility from a company formerly under common control. The loan is denominated in the amounts of HK$21,125,000 (equivalent to $2,704,000 at December 31, 2010) and US$3,878,000 (equivalent to $3,857,000 at December 31, 2010) and is unsecured and bears interest at 6.25%. The Company repaid HK$21,125,000 ($2,820,000) and US$878,000 ($892,000) during the year ended December 31, 2010 bringing the balance down to US$3,000,000 ($2,984,000) at December 31, 2010. The Company incurred $383,000 (2009 - $283,000, 2008 - $426,000) of interest which has been included in interest on long-term debt on the statement of operations and deficit.

The remaining portion of the loan is due on September 1, 2012; however, subsequent to the end of the reporting period, the Company repaid the remaining balance of the loan.

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

8. SHARE CAPITAL AND CONTRIBUTED SURPLUS

Authorized share capital consists of an unlimited number of common shares without nominal or par value and 21 million Series 1 non-voting, non-cumulative preferred shares, convertible into common shares on a 1:1 basis. Any issued and outstanding preferred shares will automatically be converted into common shares in 2010. There are currently no outstanding preferred shares.

Outstanding shares are as follows:

	Thousands of
	shares		Amount
Common shares
Balance at December 31, 2009 and 2010	34,698	$	38,246
Contributed Surplus
Balance at December 31, 2009 and 2010		$	338

9. STOCK OPTIONS

The Company maintains a stock option plan and grants options to officers, directors and employees of the Company at market prices. A total of 785,000 shares were reserved for issue under the plan. The options vest at the date of grant and expire five years thereafter.

There were no options to purchase shares outstanding as at December 31, 2008, 2009 and 2010.

There were no options granted or modified during the three years ended December 31, 2010.

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

10. WRITE-DOWN OF INVENTORY AND GINSENG CROPS

		2010		2009			2008
Write-down of ginseng inventory	$	-	$	64		$	2,498
Reversal of prior year write-down of ginseng crops		-		(500	)		-
Write-down of ginseng crops		170		450			500
	$	170	$	14		$	2,998

For the year ended December 31, 2010, the Company recorded a write-down on the ginseng crops that are expected to be part of the 2011 harvest. This write-down was recorded due to frost at one of the Company’s farm locations which harmed the ginseng crops and reduced the expected yield from that location which in turn reduced the net realizable value of those ginseng crops.

For the year ended December 31, 2009, the Company recorded a reversal of the $500,000 write-down on its ginseng crops that were harvested during the last quarter of 2009. The net realizable value of the ginseng crops harvested in 2009 was higher than had been estimated at December 31, 2008 and therefore the Company reversed the entire write-down that had been recorded. The net realizable value as at December 31, 2009 was determined through sales contracts with buyers that had been agreed to during the final quarter of 2009. At December 31, 2009, the Company recorded a write-down of $450,000 on its long-term ginseng crops which it intends to harvest at the end of 2011. The net realizable value of the long-term ginseng crops was estimated based on current sales prices and estimated future yields, quality and costs to bring the crops to harvest. The Company also recorded a write-off of $64,000 on ginseng fibres from prior harvests as the ability of the Company to sell these specific ginseng fibres was uncertain.

For the year ended December 31, 2008, the Company recorded a write-down of inventory of $2,498,000 on its ginseng crops harvested in 2008 to reduce the carrying value of the inventory to its estimated net realizable value. This amount includes a $1,500,000 write-down in the third quarter of 2008 and an additional $998,000 write-down that was recognized upon the completion of the 2008 harvest. The Company also recorded a write-down of $500,000 on its current ginseng crops which it intended to harvest at the end of 2009. The net realizable value of the inventory was estimated based on purchase commitments received for inventory on hand.

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

11. SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

		2010		2009		2008
Retention bonus	$	151	$	-	$	-
Wind-up expenses of terminated operations		-		530		-
Other selling, general and administrative expenses		806		928		969
	$	957	$	1,458	$	969

During 2010, the Company agreed to pay retention bonuses totaling $485,000 to corporate and farm management and staff to ensure the stability of the operation through the expected final harvest in 2011 and the sale of the Company’s assets in 2012. These retention bonuses are contingent on the satisfactory completion of the job duties of each employee up to their termination date. During 2010, $151,000 of expenses was incurred with $4,000 being paid and $147,000 accrued and included in accounts payable and accrued liabilities. The remaining balance will be recorded over the remaining service period for the employees and will be adjusted for changes in employees on a prospective basis.

For 2009, the wind-up expenses of terminated operations include all expenditures associated with closing the ginseng farm operations in British Columbia after the final harvest was completed in 2008.

12. OTHER INCOME (LOSS)

		2010		2009		2008
Foreign exchange gain (loss)	$	69	$	470	$	(769	)
Gain on disposal of property, plant and equipment		591		611		256
Government supplements		138		995		64
Other non-operating income		14		3		3
	$	812	$	2,079	$	(446	)

Foreign exchange gain (loss) for the year ended December 31, 2010 includes a $64,000 loss on foreign exchange forward contracts (2009 - $357,000 loss, 2008 - $451,000 gain).

Government supplements include funds received from Agriculture Canada as compensation for cost of production increases and reduced margins of the Company's farming operations in prior years, net of program participation fees and related costs. The substantial amount received in 2009 was from the 2007 program year and the additional amount received in 2010 was due to an amendment filed for that same program year. The Company considers these payments non-recurring and are recorded as received.

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

13. FUTURE INCOME TAXES

Temporary differences and loss carryforwards that give rise to future income tax assets and liabilities as at December 31, 2010 and 2009 are as follows:

		2010			2009
Future income tax assets (liabilities)
Property, plant and equipment	$	(135	)	$	(41	)
Tax loss carryforwards		4,865			5,041
		4,730			5,000
Less: valuation allowance		4,730			5,000
Future income tax assets	$	-		$	-

The majority of the above differences relate to the Company’s farming operations, which are taxable on a cash basis under Canadian tax law and allow for taxable adjustments of inventory and ginseng crops at the discretion of the Company.

The provision for income taxes has been calculated as follows:

		2010			2009			2008
Canadian statutory tax rate		31.00	%		33.00	%		33.50	%
Income taxes payable (recoverable) at
the Canadian statutory rates	$	235		$	221		$	(1,541	)
Adjustments:
Foreign tax rate differential		10			(10	)		34
Change in future income tax rates		35			1,477			80
Other		(10	)		22			(57	)
Valuation allowance		(270	)		(1,710	)		1,484
Provision for income taxes	$	-		$	-		$	-

The Company’s foreign subsidiaries have tax losses available for carry forward of approximately $809,000 to reduce future taxable income, subject to the approval of the tax authorities, which can be carried forward indefinitely. The Company and domestic subsidiaries have tax losses available for carry forward of approximately $18,779,000 which can be applied to reduce future taxable income and expire at various times over the next four to twenty years.

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

14. COMMITMENTS, CONTINGENCIES AND GUARANTEES

Operating leases and land rentals

The Company has entered into operating leases for vehicles, farming equipment and offices expiring at various times to 2012. Total future minimum payments required under these leases are as follows:

2011	$	88
2012		22
	$	110

The Company is committed to agricultural land rentals for the next two years as follows:

2011	$	52
2012		39
	$	91

The Company’s commitment to agriculture land rentals for 2012 can be alleviated upon completion of the harvest of the ginseng crops in 2011 and after notification has been given to the respective landlords.

The Company has paid rental costs on operating leases and land rentals of $205,000, $302,000 and $476,000 for the years ended December 31, 2010, 2009 and 2008, respectively, of which $170,000, $265,000 and $441,000 was capitalized to crop costs for the respective years.

15. FOREIGN EXCHANGE FORWARD CONTRACTS

As at December 31, 2010, the Company had entered into a forward contract with a Canadian bank to purchase US$1,400,000 on March 28, 2011 to partially fix the rate of exchange on the term loan described in Note 7. If the spot Canadian/US dollar exchange rate is less than or equal to $1.0150 on the contract date, the exchange rate of the purchase will be $1.0150. If the exchange rate is greater than or equal to $1.0650 on the contract date, the exchange rate of the purchase will be $1.0650. If the exchange rate is between $1.0150 and $1.0650 on the contract date, the contract will expire and a purchase obligation will not take place. At December 31, 2010, the closing exchange rate of $0.9946 resulted in a liability of $29,000 for the Company on the contract which is included in accounts payable and accrued liabilities.

As at December 31, 2010, the Company had entered into a forward contract with a Canadian bank to purchase US$250,000 on January 14, 2011 at a rate of $0.9961 to partially fix the rate of exchange on a term loan payment on the loan described in Note 7. At December 31, 2010, the closing exchange rate of $0.9946 resulted in a foreign exchange loss of less than $1,000 for the Company on the contract which is included in accounts payable and accrued liabilities.

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

As at December 31, 2009, the Company had entered into a forward contract with a Canadian bank to purchase US$1,400,000 on March 22, 2010 to partially fix the rate of exchange on the term loan described in Note 7. If the spot Canadian/US dollar exchange rate was less than or equal to $1.0625 on the contract date, the exchange rate of the purchase would have been $1.0625. If the exchange rate was greater than or equal to $1.0775 on the contract date, the exchange rate of the purchase would have been $1.0775. If the exchange rate was between $1.0625 and $1.0775 on the contract date, the contract would expire and a purchase obligation would not take place. At December 31, 2009, the closing exchange rate of $1.0510 resulted in a liability of $16,000 for the Company on the contract which was included in accounts payable and accrued liabilities.

16. SEGMENTED REPORTING

The Company operates in one industry segment and two geographic regions. The geographic region that the external revenue is derived from is determined by the residency of the customer. Intersegment revenue is determined by the residency of the subsidiary selling the product. Information by geographic region is summarized as follows:

		2010			2009		2008
External revenue from operations located in:
Canada	$	3,841		$	1,473	$	1,196
Hong Kong and People's Republic of China		5,110			5,468		8,036
Total external revenue	$	8,951		$	6,941	$	9,232
Intersegment revenue from operations located in:
Canada	$	4,580		$	4,454	$	7,002
Hong Kong and People's Republic of China		-			556		277
Total intersegment revenue	$	4,580		$	5,010	$	7,279
Net earnings (loss) from operations located in:
Canada	$	839		$	605	$	(4,022	)
Hong Kong and People's Republic of China		(80	)		64		(648	)
Total net earnings (loss)	$	759		$	669	$	(4,670	)

All of the Company’s long-lived assets, which comprise of all assets not classified as current, were in Canada as at December 31, 2010, 2009 and 2008.

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

Major Customers

Major customers include all customers with whom the Company has derived revenue greater than 10% of its total revenue within the reporting period.

For the year ended December 31, 2010, consolidated revenue included sales to four customers. Two of these customers accounted for $2,103,000 and $1,444,000, respectively, from the Hong Kong and People’s Republic of China geographic region, one customer accounted for $1,647,000 from the Canadian geographic region, and a fourth customer accounted for a total of $2,730,000 of which $1,843,000 was from the Canadian geographic region and $887,000 was from the Hong Kong and People’s Republic of China geographic region.

For the year ended December 31, 2009, consolidated revenue included sales to three customers, which accounted for $1,040,000 from the Canadian geographic region and $2,328,000 and $2,013,000, respectively, from the Hong Kong and People’s Republic of China geographic region.

For the year ended December 31, 2008, consolidated revenue included sales to three customers, which accounted for $3,049,000, $2,825,000 and $2,192,000, respectively, from the Hong Kong and People’s Republic of China geographic region.

17. CAPITAL DISCLOSURES

The Company's current objective in managing capital is to provide maximum returns for shareholders and benefits for other stakeholders. The Company includes shareholders’ equity, lease financing, term loans, bank financing, and equipment loan purchases in its definition of capital. The Company met its objective in managing capital by using funds from the sale of inventory and assets held for sale to repay debt while maintaining sufficient capital to fund operations. The Company is not subject to any externally imposed financial covenants.

CHAI-NA-TA CORP.

Notes to the Consolidated Financial Statements

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars)

For the years ended December 31, 2010, 2009 and 2008

18. FINANCIAL INSTRUMENTS

Financial instruments of the Company are represented by cash, accounts receivable and other assets, bank indebtedness, accounts payable and accrued liabilities, long-term debt and foreign exchange forward contracts. The carrying value of these instruments, other than long-term debt, approximates their fair value due to the short-term maturity of such items or their bearing market related rates of interest. The fair value of the long-term debt is not readily determinable due to the lender being a company formerly under common control.

Hierarchy of Financial Instruments

The following fair value hierarchy reflects the significance of the inputs used in making measurements of the Company’s financial instruments:

As at December 31, 2010
Held for trading		Total		Level 1		Level 2		Level 3
Financial assets
Cash	$	2,659	$	2,659	$	-	$	-
Financial liabilities
Foreign exchange forward contracts	$	29	$	-	$	29	$	-
As at December 31, 2009
Held for trading		Total		Level 1		Level 2		Level 3
Financial assets
Cash	$	2,488	$	2,488	$	-	$	-
Financial liabilities
Foreign exchange forward contracts	$	16	$	-	$	16	$	-

Level 1 includes financial instruments for which quoted prices in active markets exist for identical assets or liabilities. Level 2 includes financial instruments for which fair value inputs other than quoted prices are observable for the asset or liability, either directly or indirectly. Level 3 includes financial instruments for which fair value inputs are not based on observable market data. There were no significant transfers between Level 1 and Level 2 of the fair value hierarchy during 2010.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages liquidity risk through the management of its capital structure and financial leverage as outlined in Note 17. The Company’s financial obligations are due as follows:

CHAI-NA-TA CORP. 

Notes to the Consolidated Financial Statements 

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars) 

For the years ended December 31, 2010, 2009 and 2008 

		Total		Within 1 Month		Between 1 and 3 Months		Between 3 and 12 Months		Between 1 to 3 Years
Accounts payable	$	65	$	65	$	-	$	-	$	-
Accrued liabilities		310		83		158		69		-
Interest on long-term debt		16		-		16		-		-
Long-term debt		2,984		1,492		1,492		-		-
	$	3,375	$	1,640	$	1,666	$	69	$	-

Interest accrued at December 31, 2010 is included in accrued liabilities while estimated future interest payments are included in interest on long-term debt.

Interest rate risk

At December 31, 2010, the Company has no debt facilities at variable interest rates so therefore the Company is not exposed to significant interest rate risk.

Credit risk

Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations. The Company is exposed to credit risk on accounts receivable from customers and on cash and foreign exchange forward contracts.

A majority of the Company's sales are made to a small number of customers that are concentrated in Asian markets. To manage its credit risk, the Company carefully monitors credit terms, investigates credit history and only grants credit to customers with established relationships or acceptable credit ratings. Letters of credit may be used, or inventory may be held as security until payment is received, when such relationships have not been established. As at December 31, 2010, there was $NIL in accounts receivable related to major customers (December 31, 2009 - $NIL related to major customers). As at December 31, 2010, the amount of past due accounts receivable was $4,000. There was no impairment allowance recorded for possible non-collection of this amount as the amount was collected by the Company in the first week of 2011.

The credit risk on the Company's cash and foreign exchange forward contracts are substantially minimized as they are placed in, or contracted with, large financial institutions. While the Company is exposed to credit losses due to the financial collapse by those who are custodians to the Company's cash and those that are counter parties to the foreign exchange forward contracts, the Company considers this risk quite remote.

Currency Risk

The Company is exposed to currency exchange risk as a result of its international markets and operations and due to the term loan detailed in Note 7. The Company periodically enters into foreign exchange forward purchase contracts to manage foreign exchange risk associated with anticipated future debt and interest payments denominated in foreign currencies.

CHAI-NA-TA CORP. 

Notes to the Consolidated Financial Statements 

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars) 

For the years ended December 31, 2010, 2009 and 2008 

The Company is exposed to currency risk through the following assets and liabilities denominated in United States dollars (all assets and liabilities denominated in Hong Kong dollars have been translated to United States dollars at the rate of 7.80 Hong Kong dollars to 1.00 United States dollars which is a fixed rate determined by the Hong Kong Monetary Authority):

(in thousands of United States dollars)		2010			2009
Cash	$	800		$	19
Accounts receivable		-			1
Foreign exchange contracts		1,650			1,400
Accounts payable and accured liabilities		(4	)		(208	)
Long-term debt		(3,000	)		(6,603	)
Net exposure	$	(554	)	$	(5,391	)

The Canadian dollar equivalent of the net exposure, using December 31, 2010 exchange rates, as at December 31, 2010 would be a net liability of $551,000 and as at December 31, 2009 would be a net liability of $5,362,000.

Based on the above net exposure as at December 31, 2010, an increase in the spot Canadian/US dollar exchange rate of $0.10 would result in a foreign exchange loss of $55,000 while a decrease of $0.10 would result in a corresponding foreign exchange gain.

The Company also has foreign exchange exposure related to the foreign exchange adjustment of the deficit of self-sustaining foreign operations which is included in accumulated other comprehensive income. As a result, an increase in the spot Canadian/US dollar exchange rate of $0.10 would result in other comprehensive income of $195,000 while a decrease of $0.10 would result in a corresponding other comprehensive loss. Cumulatively, an increase in the spot Canadian/US dollar exchange rate of $0.10 would result in an increase to comprehensive income of $140,000 while a decrease of $0.10 would result in a corresponding decrease to comprehensive income.

19.  RELATED PARTY TRANSACTIONS 

In the normal course of business, the Company pays management fees to Wai Kee for performing sales, accounting and administrative services for CNT Trading (Hong Kong) Limited. The Company paid management fees of $63,000 for the year ended December 31, 2010 (2009 - $114,000, 2008 - $103,000) of which $10,000 remains outstanding as at December 31, 2010 (2009 - $17,000, 2008 - $20,000) and is included in accounts payable and accrued liabilities. This related party transaction is measured at the exchange value.

CHAI-NA-TA CORP. 

Notes to the Consolidated Financial Statements 

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars) 

For the years ended December 31, 2010, 2009 and 2008 

20. DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES

These consolidated financial statements have been prepared in accordance with Canadian GAAP which differ in some respects from US GAAP. The following adjustments and additional disclosures would be required in order to present the financial statements in accordance with US GAAP and with practices prescribed by the Securities and Exchange Commission as at December 31, 2010 and 2009 and for the years then ended.

The significant differences between Canadian and US GAAP which affect the Company’s financial statements are summarized below:

a)      Accounting for Capitalization of Interest

Under Canadian GAAP, interest relating to expenditures on ginseng crop costs has been capitalized. The interest is included in inventory when the ginseng crops are harvested and cost of goods sold when the inventory is sold.

Under US GAAP, the portion of interest relating to expenditures on ginseng crop costs would not be eligible for capitalization to ginseng crop costs. The amount would be expensed as period costs and accordingly, the carrying value of crop costs and inventory under US GAAP would be different. Similarly, interest that had been capitalized under Canadian GAAP and included in cost of sales would not have been reported as cost of sales for the period under US GAAP since such costs would have previously have been expensed as period costs.

b)      Accounting for Write-downs of Inventory and Ginseng Crops

Under Canadian GAAP, inventory and ginseng crops are recorded at the lower of cost or estimated net realizable value. Any write-down to estimated net realizable value can be reversed in subsequent periods if there is a change in circumstances which result in an increase in the estimated net realizable.

Under US GAAP, inventory and ginseng crops are also recorded at the lower of cost or estimated net realizable value but there is no allowance to reverse a write-down to estimated net realizable value as there is under Canadian GAAP.

c)      Interest and Finance Charges

Under Canadian GAAP, interest and finance charges are presented as operating expenses and are included in the calculation of operating income.

Under US GAAP, interest and finance charges would be presented as non-operating expenses and would therefore be excluded from the calculation of operating income.

CHAI-NA-TA CORP. 

Notes to the Consolidated Financial Statements 

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars) 

For the years ended December 31, 2010, 2009 and 2008 

d)      Liability for Uncertain Tax Positions

As provided by Accounting Standards Codification (“ASC”) 740 Income Taxes (formerly FASB Interpretation 48 – Accounting for Uncertainty in Income Taxes), under US GAAP there is a requirement to evaluate any tax positions that are uncertain and, if necessary, calculate a liability for uncertain tax positions..

Under current conditions and expectations, the Company does not foresee any significant changes in unrecognized tax benefits that would be have a material impact on the Company’s financial statements. The Company recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The Company has not accrued interest or penalties related to uncertain tax positions as of December 31, 2010. Management is currently unaware of any issues under review that could results in significant payments, accruals or material deviations from its position.

e)      Recent Accounting Pronouncements

Pronouncements from the United States

In January 2010, the FASB issued ASU 2010-06, "Improving Disclosures about Fair Value Measurements," which amends ASC 820 to add new requirements for disclosures about transfers into and out of Level 1 and 2 measurements and separate disclosures about purchases, sales, issuances and settlements relating to Level 3 measurements. This ASU also clarifies existing fair value disclosure requirements about the level of disaggregation and about inputs and valuation techniques used to measure fair value. Further, this ASU amends guidance on employers' disclosures about postretirement benefit plan assets under ASC 715 to require that disclosures be provided by classes of assets instead of by major categories of assets. This standard is effective for the first reporting period (including interim periods) beginning after December 15, 2009, except for the requirement to provide the Level 3 activity of purchases, sales, issuances, and settlements on a gross basis, which will be effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. The Company adopted the required provisions of this standard during the first quarter of 2010 and the disclosures are included in Note 18.

CHAI-NA-TA CORP. 

Notes to the Consolidated Financial Statements 

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars) 

For the years ended December 31, 2010, 2009 and 2008 

The difference between Canadian and US GAAP and their effect on the Company’s consolidated financial statements are summarized below. All amounts except per share amounts are in thousands of Canadian dollars:

CONSOLIDATED BALANCE SHEET

			2010			2009
Assets
Inventory	- Canadian GAAP	$	4,839		$	6,668
	- Interest capitalized (a)		(4	)		(13	)
	- Write-down of inventory (b)		-			(486	)
	- US GAAP	$	4,835		$	6,169
Ginseng crops current	- Canadian GAAP	$	3,149		$	3,898
	- Interest capitalized (a)		(4	)		(4	)
	- Write-down of crop costs (b)		4			-
	- US GAAP	$	3,149		$	3,894
Ginseng crops	- Canadian GAAP	$	-		$	2,154
	- Interest capitalized (a)		-			(3	)
	- Write-down of crop costs (b)		-			3
	- US GAAP	$	-		$	2,154
Shareholders' Equity	- Canadian GAAP	$	8,014		$	7,144
	- Interest capitalized (a)		(8	)		(20	)
	- Write-down of inventory (b)		4			(483	)
	- US GAAP	$	8,010		$	6,641

CONSOLIDATED STATEMENT OF OPERATIONS

		2010		2009			2008
Net earnings (loss) as reported under Canadian GAAP	$	759	$	669		$	(4,670	)
Accounting for interest (a)		-		4			13
Write-down of inventory and crop costs (b)		502		(501	)		(9	)
Net earnings (loss) under US GAAP		1,261		172			(4,666	)
Basic and diluted earnings (loss) per share	$	0.04	$	0.00		$	(0.13	)
Weighted average number of common shares (in thousands)		34,698		34,698			34,698

CHAI-NA-TA CORP. 

Notes to the Consolidated Financial Statements 

(Stated in Canadian Dollars except tabular amounts in thousands of Canadian dollars) 

For the years ended December 31, 2010, 2009 and 2008 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

		2010		2009		2008
Net earnings (loss) under US GAAP	$	1,261	$	172	$	(4,666	)
Other comprehensive income (loss):
Adjustments as a result of foreign exchange
translation of self-sustaining subsidiaries		111		364		(460	)
Comprehensive net earnings (loss) under US GAAP	$	1,372	$	536	$	(5,126	)

CONSOLIDATED STATEMENT OF CASH FLOWS

There are no material differences in net cash flows from Operating, Financing, and Investing Activities between US and Canadian GAAP.

EX-8.1

Exhibit 8.1

	Corporate Organizational Chart
	As at December 31, 2010

EX-12.1

Exhibit 12.1

CERTIFICATION

I, Wilman Wong, certify that:

1.	I have reviewed this annual report on Form 20-F of Chai-Na-Ta Corp.(the “Company”);
2.	Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;
3.	Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this annual report;
4.	The Company's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:

a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with general accepted accounting principles;
c.	Evaluated the effectiveness of the Company's disclosure controls and procedures and presented in this report our conclusion about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.	Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and

5.      The Company's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company's auditors and the audit committee of Company's board of directors (or persons performing the equivalent function):

a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company's ability to record, process, summarize and report financial information; and
b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting.

/s/ “WILMAN WONG” 

Wilman Wong, Chief Executive Officer 

Date: March 31, 2011

EX-12.2

Exhibit 12.2

CERTIFICATION

I, Terry Luck, certify that:

1.	I have reviewed this annual report on Form 20-F of Chai-Na-Ta Corp.(the “Company”);
2.	Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;
3.	Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this annual report;
4.	The Company's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:

a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with general accepted accounting principles;
c.	Evaluated the effectiveness of the Company's disclosure controls and procedures and presented in this report our conclusion about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.	Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and

5.      The Company's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company's auditors and the audit committee of Company's board of directors (or persons performing the equivalent function):

a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company's ability to record, process, summarize and report financial information; and
b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting.

/s/ “TERRY LUCK” 

Terry Luck, Chief Financial Officer 

Date: March 31, 2011

EX-13.1

Exhibit 13.1

Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Annual Report on Form 20-F of Chai-Na-Ta Corp (the “Company”) for the year ended December 31, 2010 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Company certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of such officer’s knowledge:

(1)	the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	the information contained in the Report fairly presents, in all material respects, the financial condition and results of the operations of the Company.

/s/ WILMAN WONG		/s/ TERRY LUCK
Name:	Wilman Wong	Name:	Terry Luck
Title:	Chief Executive Officer	Title:	Chief Financial Officer
Date:	March 31, 2011	Date:	March 31, 2011