Bill passed in US Congress to delist Chinese companies from stock market

(PTI) Washington, Ta. Thursday, December 3, 2020

The United States has taken a big step against Chinese companies, further straining its conflicting relations with China. A bill was passed in the US Congress on Wednesday that would allow Chinese companies that do not meet their audit authority for three consecutive years to be delisted from the US stock market.

The move by the US Congress could put Chinese companies in trouble for fraudulently concealing important details, including company ownership. The U.S. Congress passed the Bypartition Holding Foreign Companies Accountable Act Bill on Wednesday.

The bill also passed the Senate on May 20. It will now be sent to the White House for the signature of outgoing US President Donald Trump. The bill would protect American investors and their retirement savings from investing in foreign companies.

The bill would prevent companies that do not comply with the Public Company Accounting Oversight Board (PCAOB) audit rules from being listed on the US stock market for three consecutive years.

In addition, companies listed on the US stock market will have to state whether they operate under the control of a foreign government, including the Communist government of China. Under the law, the U.S. government will ensure that foreign companies doing business in the U.S. comply with audit rules that apply to U.S. companies.

The Trump administration has taken a series of steps that continue to strain economic relations between the United States and China. Senator Kevin Kramer said, "We do not want American investors to be troubled by the Chinese Communist government.

The bill would make it safer for American investors to invest in foreign companies. MP Brad Sherman said the bill was not intended to de-list any companies, but to prevent Chinese companies from violating US audit rules.

Currently, PCAOB cannot audit some foreign companies. Among these companies, Chinese companies are the main ones. Some foreign companies, including China, do not provide PCAOB with their audit information, citing local laws related to data protection, privacy and national security.