CNBC: The U.S. Senate passed legislation on Wednesday that could ban many Chinese companies from listing shares on U.S. exchanges or raising money from American investors without adhering to Washington’s regulatory and audit standards.
The bill, sponsored by Louisiana Republican Sen. John Kennedy, would require companies to certify that “they are not owned or controlled by a foreign government.” Alibaba, the e-commerce giant based in China, saw its U.S.-listed shares fall more than 2% on the news.
Though the law could be applied to any foreign company that seeks access to U.S. capital, lawmakers say the move to strengthen disclosure requirements is aimed principally at Beijing.
The White House did not immediately respond to CNBC’s request for comment.
“The Chinese Communist Party cheats, and the Holding Foreign Companies Accountable Act would stop them from cheating on U.S. stock exchanges,” Kennedy, a member of the Senate Banking Committee, wrote on Twitter Tuesday afternoon. “We can’t let foreign threats to Americans’ retirement funds take root in our exchanges.”
Specifically, the statute would require a foreign company to certify it’s not owned or manipulated by a foreign government if the Public Company Accounting Oversight Board is unable to audit specified reports because the firm uses a foreign accounting firm not subject to inspection by the board.
Read the full article at CNBC.
