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More Than 80 Chinese Companies May Face Possible U.S Delisting

Including Pinduoduo, Bilibili, JD.com, and NetEase, other 80 Chinese large corporations that entered the new list by SEC.

More Than 80 Chinese Companies May Face Possible U.S Delisting

More than 80 Chinese companies, including Pinduoduo, Bilibili, JD.com, and NetEase, have entered the list of entities that may be expelled from American Stock Exchanges. 

The U.S Securities and Exchange Commission, in furtherance of a 2020 legislation known as The Holding Foreign Companies Accountable Act, has made a temporary list of U.S listed Chinese entities. 

The new Act seeks to strike off foreign-based companies from the U.S stock markets if they violate American Auditing Standards for 3 consecutive years. It is interesting to note that this piece of law was passed by former President Donald Trump. 

JinkoSolar Holdings, China Petroleum&Chemicals, and NIO were some other large Chinese corporations that entered the new list by SEC.

Interestingly, even Chinese regulators have directed the U.S listed Chinese companies such as JD.com, Baidu, and Alibaba to arm themselves with more audit disclosures. 

Early April saw Beijing proposing to update their confidentiality rules relating to the offshore listing, a tactical move to overcome the legal complexities of Chinese-American audit oversight cooperation and shift the burden on Chinese corporations to conceal Chinese information. 

This news was released after a U.S agency disclosed in March, stating that they are continuing to negotiate with Chinese regulators to reach a middle ground on accessing the records of the auditors. However, it was unclear if the new U.S listing law would coerce the Chinese government to allow access under it.

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