Congress passes legislation to force groups to adhere to American accounting standards
Congress has passed legislation that would force Chinese companies to delist from American exchanges unless they comply with US accounting rules.
The House of Representatives on Wednesday passed the bill, which could affect companies from China Telecom to Alibaba, following Senate passage in May. Donald Trump is expected to sign the legislation, which has benefited from a bipartisan consensus over taking a tougher line against China.
The Holding Foreign Companies Accountable Act requires Chinese companies to give the US Public Company Accounting Oversight Board access to audited accounts — something that is currently prohibited by Beijing. It would also force companies listed on US exchanges to prove that they are not controlled by a foreign government.
In August, the US Treasury and the Securities and Exchange Commission issued recommendations to ban Chinese companies from American exchanges unless they complied with US accounting standards.