Bill to delist Chinese stocks may disadvantage U.S. investors, says Harvard law professor Description video: Under a new bill, passed by the U.S. Senate last month, Chinese firms risk being delisted from U.S. stock exchanges if they don’t adhere to […]
Bill to delist Chinese stocks may disadvantage U.S. investors, says Harvard law professor
Under a new bill, passed by the U.S. Senate last month, Chinese firms risk being delisted from U.S. stock exchanges if they don’t adhere to U.S. audit standards. But, if the law is passed, it’s unclear if U.S. investors will be left \”better off,\” says Jesse Fried, a professor of law at the Harvard Law School.
China to allow US regulators to audit their state-owned companies
China is proposing to allow US regulators to audit its state-owned enterprises as a concession aimed at resolving long-standing accounting differences between countries. At the same time, the Celestial Empire will insist on editing some information for reasons of national security.
The United States has long complained about the lack of auditors’ access to working papers for US-listed Chinese companies. Earlier this month, Washington threatened to take action to delist Chinese companies that did not meet its audit requirements..
Fang Xinghai, the vice chairman of the China Securities Regulatory Commission (CSRC) told Bloomberg that this month the CSRC sent the PCAOB a new proposal that would allow the United States to select any of its SOEs for inspection trial.
The article reports that a previous pilot review conducted jointly with regulators in China and the United States did not lead to an understanding between the parties..
Fang also called for direct talks with US officials, but his offer for a video or phone meeting has so far remained unanswered..
Fang’s remarks echo the August 8 CSRC statement in response to signals from the presidential administration Donald Trump about possible delisting.
In this statement, CSRC emphasized that it is proposing joint accounting audits with US regulators, demonstrating «complete sincerity about cooperation». CSRC also believes that solving a problem through dialogue is the only way to «win-win» situations.