WASHINGTON, Dec 18 (Reuters) – Donald Trump signed a law on Friday that would kick Chinese companies off American stock exchanges unless they adhere to the country’s auditing standards, the White House said, giving the Republican president a new tool to threaten Beijing before leaving office in January.
The “Foreign Company Liability Act” prohibits the securities of foreign companies from being listed on any US stock exchange if they have not met audits from the Public Accounting Oversight Board for three years in a row.
Although it applies to companies from any country, the backers of the legislation tried to link it to target Chinese companies listed in the United States, such as Alibaba, technology firm Pinduoduo Inc, and oil giant PetroChina Co Ltd.
The legislation, like many others that take a harder line on Chinese companies, had been approved by Congress by wide margins earlier this year.
Lawmakers, both Democrats and Republicans, echo the president’s hard line against Beijing, which grew fiercer this year when Trump blamed China for the coronavirus plaguing the United States.
The law would also require public companies to disclose whether they are owned or controlled by a foreign government.
Chinese officials have criticized the move as a discriminatory policy that politically oppresses their companies. Authorities have long been reluctant to allow foreign regulators to inspect local accounting firms, citing national security concerns.
Report by Patricia Zengerle and Eric Beech, Edited in Spanish by Manuel Farías
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