US pushes ahead with new rules for Chinese firms

      Published on Friday, 11 December , 2020      70 Views     

  • China Business

The act would also require companies to disclose whether they are owned or controlled by a foreign government.

The Holding Foreign Companies Accountable Act still needs the US president’s approval.

The move coincides with a wider push to ramp up pressure on China in the final months of the Trump presidency.

In addition to the act, the US government on Wednesday moved to ban cotton imports from a company it says uses the forced labour of detained Uighur Muslims.

The US also took action against Chinese-manufactured twist ties last week, taking the rare step of imposing tariffs to counter the effects of what the US claims is Chinese currency manipulation.

China too has increased pressure, introducing export control laws earlier this week.

This was widely seen as a response to US export controls on microchips that many Chinese tech companies rely on.

‘Toxic status quo’

The act will have little effect over the short term, as foreign companies are only banned if they fail to comply with audits for three years in a row.

The American Securities Association welcomed the bill’s passage, but urged the government to act more swiftly by delisting non-compliant companies by the middle of next year.

The legislation applies to publicly-listed companies from any country, but its sponsors intended for it to target Chinese companies.

“US policy is letting China flout rules that American companies play by, and it’s dangerous. Today, the House joined the Senate in rejecting a toxic status quo,” said Republican Senator John Kennedy, who is one of the bill’s authors.

The US-China Economic and Security Review Commission – which was created by Congress to track possible security threats from China – said that as of October there were 217 Chinese companies listed on these US exchanges.

A number of US-listed Chinese firms, including Alibaba and KFC China operator Yum China, have recently carried out secondary listings in Hong Kong.

Category China Business | 2020/12/11 latest update at 9:43 AM
Source : BBC | Photocredit : Google
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