US passes
bill to delist Chinese companies
Daniel Flatley
May 21, 2020 – 4.28pm
The US Senate on Wednesday approved
by unanimous consent legislation that could bar some Chinese companies from
being listed on US stock exchanges amid increasingly tense relations between
the world's two largest economies.
The bill, introduced by Republican senator John Kennedy,
from Louisiana, and Chris Van Hollen, a Democrat from Maryland, would require
companies to certify that they are not under the control of a foreign
government.
If a company can't certify that it is not under such control
or the Public Company Accounting Oversight Board isn't able to audit the
company for three consecutive years to determine that it is not under the
control of a foreign government, the company's securities would be banned from
the exchanges.
I would not turn my back on the
Chinese Communist Party if they were two days dead.
— John Kennedy, Republican senator
"I do not want to get into a new cold war,"
Senator Kennedy said on the Senate floor, adding that he wanted "China to
play by the rules".
So far, no companion measure has been introduced in the US
House of Representatives, according to a Senate aide familiar with the bill.
The legislation – S. 945 – is
another example of the rising pushback against China in Congress that had been
building over trade and other issues. It has been amplified more recently by
Republicans as President Donald Trump has sought to blame China as
the main culprit in the coronavirus pandemic.
GOP lawmakers have in recent weeks unleashed a torrent of
legislation aimed at punishing China for not being more forthcoming with
information or proactive in restricting travel as the coronavirus began to
spread from Hubei province, where it was first detected.
But the President's focus on blaming China for the pandemic
has threatened what had been a strong bipartisan consensus that the US needs to
get tougher on the country. Some Democrats have begun to shy away from
initiatives that could be seen as further politicising the issue as the US
heads toward November's presidential election.
Senator Kennedy told Fox Business on Tuesday that the bill
would apply to US exchanges such as Nasdaq and the New York Stock Exchange.
"I would not turn my back on the Chinese Communist
Party if they were two days dead," he said. "They cheat. And I've got
a bill to stop them from cheating."
The other sponsors of the Kennedy bill are senators Kevin
Cramer of North Dakota and Rick Scott of Florida, both Republicans.
Bloomberg
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