The U.S. Senate approved sweeping new legislation Wednesday that could ultimately bar many Chinese companies from listing shares on U.S. exchanges, or otherwise raising money from American investors. phalse phace shares a report: Sen. John Kennedy, a Louisiana Republican, submitted the Holding Foreign Companies Accountable Act for unanimous consent, a bill co-sponsored by Democratic Sen. Chris Van Hollen of Maryland and Republican Sen. Kevin Cramer of North Dakota. The bill was approved without objection. The bill would require Chinese companies to establish they are not owned or controlled by a foreign government. Furthermore, they would be required to submit to an audit that can be reviewed by the Public Company Accounting Oversight Board, the nonprofit body that oversees audits of all U.S. companies that seek to raise money in public markets. “I do not want to get into a new cold war,” Kennedy said on the Senate floor. “All I want, and I think all the rest of us want, is for China to play by the rules.” Steve Dickinson of Harris Bricken wrote in the China Law Blog that American companies seeking to raise money publicly must be audited by an accredited firm and that these audits are further monitored by the PCAOB. China has refused to allow its companies to follow U.S. securities law, arguing that Chinese law bars auditors’ work from being transferred out of the country, Dickinson wrote.
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