US Congress passes bill to delist deceitful Chinese companies from American stock markets
Washington, Dec 3: The US Congress has passed a bill that prohibits companies from being listed on American stock markets if they fail to provide the regulators access to their audit information for three years in a row, paving the way to delist deceitful Chinese companies from the US securities exchanges.
The bipartisan Holding Foreign Companies Accountable Act will help protect American investors and their retirement savings from foreign companies that have been operating on US stock exchanges while flouting oversight.
The bill was passed by the House of Representatives on Wednesday. It was passed by the Senate on May 20. The bill now heads to the White House for President Donald Trump to sign it into law.
The bill prohibits securities of a company from being listed on any of the US securities exchanges if the company has failed to comply with Public Company Accounting Oversight Board (PCAOB) audits for three years in a row.
It requires public companies to disclose whether they are owned or controlled by a foreign government, including China's communist government; and ensures foreign companies traded in America are subject to the same independent audit requirements that apply to American companies.
The Trump administration has passed a series of measures aimed at severing the economic ties between the US and China. US-China ties have deteriorated sharply over issues ranging from trade, the coronavirus pandemic and telecoms-gear maker Huawei to China's territorial claims in the South China Sea and its clampdown on Hong Kong.
There is no reason to let Communist China game the system and put American investments in jeopardy. Our bill protects our constituents' hard-earned money and shines a light on China's nefarious actions. I am glad the House supported it and look forward to President (Donald) Trump signing it, Senator Kevin Cramer said.
This may be the most significant piece of investor protection legislation passed in several years, said Congressman Brad Sherman, Chair of the Investor Protection and Capital Markets subcommittee.
It is designed to assure Financial Statement integrity of 224 US-limited companies with over USD 1.8 trillion in market capitalisation. The purpose is not to de-list any company, but to persuade China to allow the audit oversight that US investors need, and the US investors get when investing in US companies or companies in over 50 foreign jurisdictions, he said.
Currently, the Public Company Accounting Oversight Board is unable to inspect the audit work and practices of PCAOB-registered audit firms in a handful of foreign jurisdictions, primarily China.
In most cases, audit firms in those foreign countries cite local laws related to data protection, privacy, confidentiality, or national security as the reason for being unable to provide the PCAOB with the information they need to complete their inspections.
According to PCAOB, accounting firms which are unable to provide information necessary for effective oversight currently serve as the principal auditor for 224 US-listed companies which have a combined total of USD 1.8 trillion in market capitalisation.
The Holding Foreign Companies Accountable Act will protect investors and enforce a level playing field between US and foreign companies by requiring companies which go three years without the appropriate PCAOB audit inspection to be delisted from US exchanges.
The legislation also requires foreign issuers to provide disclosures as to whether the company is owned or controlled by a foreign government.
The People's Republic of China has continuously sought to undermine and skirt rules to the detriment of American businesses and national security. In the case of their refusal to participate in PCAOB inspections, this situation is unfair and dangerous for investors, said Congressman Anthony Gonzalez.
The Holding Foreign Companies Accountable Act is designed to prevent companies based in China and certain other jurisdictions from taking advantage of our deep and liquid capital markets while avoiding the scrutiny that comes with inspection of their financial statement audits, he said.
Senator John Kennedy said China is currently using US stock exchanges to exploit American workers and families - people who put their retirement and college savings in public companies.
US policy is letting China flout rules that American companies play by, and it's dangerous, he said.
Millions of American families rely on modest investments to retire, send their kids to college, and weather financial emergencies. But many have been cheated out of their money after investing in seemingly-legitimate Chinese companies that are not held to the same standards as other publicly listed companies, Senator Chris Van Hollen said.
This bill rights that wrong, ensuring that all companies on the US exchanges abide by the same rules. I've been proud to work with Senator Kennedy on this bipartisan legislation, and I'm glad to see it pass the House with such strong support. I urge the President to sign this bill into law immediately, he said.
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London, Nov 22: A bomb disposal squad deployed as a “precaution” to the South Terminal of Gatwick Airport concluded an investigation into a "security incident" on Friday after making a “suspect package” safe.
The South Terminal of Gatwick Airport, the UK's second busiest airport after Heathrow, which was briefly shut owing to the incident reopened following the incident.
The Gatwick is around 45 km south of London.
Two people detained during the enquiries have since been allowed to continue their journey as the airport was opened.
“Police have concluded their investigation into a report of a suspect package at Gatwick Airport. Officers from the EOD (Explosive Ordnance Disposal) team made the package safe, and the airport has been handed back to its operator,” Sussex Police said in an updated statement.
“Two people detained while enquiries were ongoing have subsequently been allowed to continue their journeys. There will remain an increased police presence in the area to assist with passengers accessing the South Terminal for onward travel,” the statement added.
Earlier on Friday, the incident caused severe disruption at the busy airport’s South Terminal, while the North Terminal of Gatwick Airport remained unaffected.
“Police were called to the South Terminal at Gatwick Airport at 8.20 am on Friday (November 22) following the discovery of a suspected prohibited item in luggage,” a Sussex Police statement said.
“To ensure the safety of the public, staff and other airport users, a security cordon has been put in place whilst the matter is dealt with. As a precaution, an EOD (Explosive Ordnance Disposal) team is being deployed to the airport. This is causing significant disruption and some roads around the South Terminal have been closed. We’d advise the public to avoid the area where possible,” it said.
Footage on social media taken outside the airport showed crowds of frustrated travellers being moved away from the terminal building.
Gatwick said it was working hard to resolve the issue.
“A large part of the South Terminal has been evacuated as a precaution while we continue to investigate a security incident," the airport said in a social media post.
“Passengers will not be able to enter the South Terminal while this is ongoing. The safety and security of our passengers and staff remain our top priority. We are working hard to resolve the issue as quickly as possible.”
Train and bus services that serve the airport were also impacted while the police carried out their inquiries.
In an unrelated incident in south London on Friday morning, the US Embassy area in Nine Elms by the River Thames was the scene of a controlled explosion by Scotland Yard dealing with what they believe may have been a “hoax device”.
“We can confirm the 'loud bang' reported in the area a short time ago was a controlled explosion carried out by officers,” the Metropolitan Police said in a post on X.
“Initial indications are that the item was a hoax device. An investigation will now follow. Some cordons will remain in place for the time being but the majority of the police response will now be stood down,” it added.
