According to the report, Chinese officials have been critical of the bill, saying that there is a better way to resolve the differences between Washington and Beijing over audit issues, while allowing Chinese companies to delist would damage the U.S. capital market.
According to reports from both parties, the bill has received support. The bill was passed unanimously in the Senate in May, which means that if the house of Representatives passes it, it will have the conditions for trump to sign into law. The U.S. Securities and Exchange Commission is also considering a proposal that would require audit review as a condition for continued listing on the stock exchange, but would allow companies that do not comply with the rules to conduct over-the-counter trading.
I hope that if this bill is passed, it will become a lever to leverage the Chinese side and the US side to sit down and solve the problem, said Dan gorzer, a former general adviser to the securities and Exchange Commission and a former member of the accounting oversight board of listed companies
According to data provided by standard & Poors global market intelligence company, since January 2014, more than 170 companies headquartered in mainland China or Hong Kong have completed initial public offerings in the United States, raising about $58.7 billion.
However, if the bill forces a large number of Chinese Listed Companies in the United States to withdraw from the U.S. market, American investors holding their shares will face risks and difficulties.
Some companies have said that if the bill is passed, they will switch to listing on exchanges outside the United States, the report said. The bill says it is possible to force Hong Kong investors to convert their Chinese holdings. But it will be difficult for some investors to do so because not all U.S. brokerage firms can provide access to foreign stock markets.
Other Chinese companies may be delisting, the report said. The delisting mechanism is relatively simple. Investors can exchange their shares for cash. But the management team can buy all the shares held by American shareholders at a low price, which will benefit insiders and sacrifice external investors.
Source of this article: reference information editor: Chen Hequn_ NB12679