Unfair US rules set to spur more home floats

2021-08-21 00:00 432 View
New disclosure norms adopted by the United States" securities regulator may prompt the listed Chinese mainland companies return to Chinese bourses, said experts.
The US Securities and Exchange Commission said on Wednesday that it has adopted interim final amendments to implement the disclosure requirements under the Holding Foreign Companies Accountable Act which require firms to establish that they are not owned or controlled by a foreign government entity. These companies are also required to disclose any foreign arrangements and influence in their annual report.
Following the announcement, share prices of some Chinese mainland companies listed in the US slumped on Wednesday. Tencent Music Entertainment Group saw its share prices plunge by 27 percent and market value shrink by $14.4 billion. Likewise, the price of online discounter Vipshop Holdings declined by 21 percent and that of electric carmaker XPeng Inc by 15 percent.
Former US president Donald Trump signed the HFCA Act in December, aiming to prevent Chinese mainland companies from listing on US exchanges if they have not complied with audit requirements from the Public Company Accounting Oversight Board-the organization overseeing the audits of US-based public companies-for three consecutive years.
Foreign Ministry spokeswoman Hua Chunying stressed at a news conference on Thursday that the Act is basically an unjustified crackdown on US-listed Chinese mainland companies through political means. It has seriously distorted the basic market rules that the US has long flaunted and deprived US investors of the opportunity to benefit from Chinese mainland companies" development. The US should create a fair and unbiased business environment for all companies listed in the country, including Chinese companies, she said.
Dong Dengxin, director of the Finance and Securities Institute at the Wuhan University of Science and Technology, said this was the first time that the US government has injected political hues into the capital market, which was aimed at encumbering China"s economic development by all means. The Act, which is indeed discriminatory, has not only shut the door for Chinese companies wishing to go public in the US, but also closed the door to the US free market, he said.
Pang Ming, head of macro and strategic research at China Renaissance Securities (Hong Kong), said regulatory uncertainties were one of the major issues confronting US-listed Chinese mainland companies for some time. The Chinese mainland"s capital market is ready to better embrace new economy companies based on ongoing reforms and the closer ties with Hong Kong. As a result, some companies, which are listed or planning to go public in the US, may opt for Hong Kong and the Chinese mainland capital markets.
After the HFCA Act was passed in December, 12 US-listed Chinese mainland companies have successfully re-listed their shares in Hong Kong as of March 24.
Analysts of Galaxy Securities said in a report that there are 48 US-listed Chinese mainland companies that are eligible for re-listing in Hong Kong, which is about 18 percent of the Chinese mainland companies traded on US exchanges. Given the ever-increasing southbound capital-the amount of capital flowing into the Hong Kong stock market from Chinese mainland investors via stock connect programs-as well as the systemic advantages of the Hong Kong stock exchange, the return of US-listed Chinese mainland companies is expected to accelerate.
Related content
  • The Chinese mainland stock market remains "very attractive" for global investors over the long term, although a stretched valuation has magnified the volatility of A shares, a leading investment company said.Wang Qian, Asia-Pacific chief economist with the US-based Vanguard Investment Strategy Group and global head of Vanguard Capital Markets Model, said the forecast is based on growth outlook and diversification benefits of the A-share market.Wang"s observations come at a time when the A-share
  • Hywin Holdings, which provides wealth management services in China, on Friday started trading on the Nasdaq.The company, trading under the ticker symbol of "HYW," priced its initial public offering of 3,000,000 American depositary shares (ADSs) at 10 U.S. dollars per ADS.Each ADS represents two Class A ordinary shares of the company.Founded in 2006, the Shanghai-based company provides wealth management services, insurance brokerage services, and asset management services to its clients, and its
  • The country"s long-term goal to achieve carbon neutrality has been mirrored in the A-share market performance, with stock prices of carbon neutrality-related companies rising by an average 4.07 percent on Monday, while the benchmark Shanghai Composite Index gained 1.14 percent to close at 3443.44 points.Prices of carbon neutrality-related Shenzhen Energy Corp, Jilin Electric Power Co Ltd and Beijing Jingyuntong Technology Co Ltd increased by the daily limit of 10 percent. Steelmaker Beijing Shou
  • China"s National Equities Exchange and Quotations (NEEQ), also known as the "new third board," has seen a turnover of about 25.55 billion yuan (about 3.93 billion U.S. dollars) so far this year.From March 8 to March 12, its turnover hit approximately 2.24 billion yuan.Launched in 2013, the NEEQ intends to offer small and medium-sized enterprises a new financing channel with low costs and simple listing procedures.China has outlined a series of reforms to better orient the NEEQ to the needs and f
  • Recent fluctuations in major A-share indexes caused by rising inflation concerns in overseas markets and stock rotations will not impair the upward momentum of the A-share market, experts said.The benchmark Shanghai Composite Index shed 1.82 percent to close at 3359.29 points on Tuesday while the Shenzhen Component Index slid 2.8 percent to close at 13475.72 points. The technology-focused ChiNext in Shenzhen slumped 3.5 percent.Among the 3,700-plus A-share companies, nearly 100 companies saw the
Related recommendations
Hot Content
  • company_name : Semiconductor Manufacturing International Corporation . Date : 2000-04-03 . listing_date : 2020-07-16 . Stock_code : 688981.SH、0981.HK . stock_market : sh . address : CricketSquare,HutchinsDrive,P.O.Box2681,GrandCaymanKY1-1111,CaymanIslands . zip : 201203 . phone : 86-21-20812800 . fax : 86-21-50802868 . site : www.smics.com .
  • company_name : Zhejiang Supcon Technology Co., Ltd. . Date : 1999-12-07 . listing_date : 2020-11-24 . Stock_code : 688777.SH . stock_market : sh . address : No.309 Liuhe Road, Binjiang District, Hangzhou, Zhejiang Province . zip : 310053 . phone : 86-571-86667525 . fax : 86-571-81118603 . site : www.supcontech.com .
  • company_name : Tianneng Battery Group Co.,Ltd. . Date : 2003-03-13 . listing_date : 2021-01-18 . Stock_code : 688819.SH . stock_market : sh . address : Industrial Park, Kishan Town, Changxing County, Huzhou City, Zhejiang Province . zip : 313100 . phone : 86-572-6029388 . fax : 86-572-6129388 . site : www.cn-tn.com .
  • company_name : Ninebot Limited . Date : 2014-12-10 . listing_date : 2020-10-29 . Stock_code : 689009.SH . stock_market : sh . address : Maples Corporate Services Limited at PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands . zip : 100192 . phone : 86-10-84828002*841 . fax : 86-10-84828002 . site : www.segway.com,www.ninebot.com,www.segwayrobotics.com .
  • company_name : Shenzhen Consys Science&Technology Co., Ltd. . Date : 2004-02-27 . listing_date : 2020-10-22 . Stock_code : 688788.SH . stock_market : sh . address : 5/F, Avionics Engineering R&D Building, No. 7, Langshan Road, Gaoxin North District, Xili Street, Nanshan District, Shenzhen, Guangdong Province, China . zip : 518057 . phone : 86-755-86111131*8858 . fax : 86-755-86111130 . site : www.consys.com.cn .
  • 86-021-88888888
  • 86-021-88888888
  • info@company-cn.com