SEC temporarily halts approvals of new Chinese IPOs after Didi debacle – KION546
Paul R. La Monica, CNN Business
The Securities and Exchange Commission has instructed its staff to seek further disclosure from the Chinese company they are seeking. Publish In the United States before they approve plans to sell their shares.
Friday announcement, First reported Regulators have shown that they are much more cautious about Chinese companies trying to sell their shares in the United States following the disastrous collapse of the ride-sharing giant, according to Reuters. Didi..
Immediately after Didi Published Beijing on June 30th at the New York Stock Exchange Crack down on the company Because of concerns about that cybersecurity practice.
Diddy’s shares have plummeted by more than 30% from the initial public offering price of $ 14 per share, trading at nearly half of the peak above $ 18 hit on the IPO day.
China’s scrutiny of the company is part of a wider promotion by the government. Give more control Many of them chose to publish in New York instead of Hong Kong or Shanghai, over their homemade tech giants.
Alibaba, its e-commerce rival JD, social media giant Tencent, search engine Baidu, and electric car company Nio’s US-listed shares are all 10% to 20% last month due to concerns about tighter regulations from China. It fell between%. And potentially the United States.
“In the light of recent developments in China … We asked our staff to request specific disclosure from offshore issuers associated with China-based operators before the registration statement was declared valid.” Said SEC Chairman Gary Gensler. statement.
The SEC is particularly interested in Chinese companies that are organized as so-called Variable Interest Entities (VIEs). Although these companies are based in China, they have been established as offshore shell companies to issue shares. Often in tax-friendly locations such as the Cayman Islands.
In addition to tax cuts, companies registering their businesses outside of China were usually able to get IPO approval from US regulators more quickly.
However, Gensler disclosed to these companies more information explaining that investors were not buying shares in a company headquartered in China directly, and details about the relationship between the shell company and the parent company. I said I want you to.
He also wants more disclosure about the risks these companies face as a result of future regulatory changes by the Chinese government, and wants the companies to include more detailed financial information.
“We asked SEC staff to do additional targeted reviews of applications from companies with significant operations based in China,” Gensler said.
“I believe these changes will improve the overall quality of disclosures in registration statements for offshore issuers affiliated with China-based operators,” said Gensler.
Following the statement, the China Securities Regulatory Commission (CSRC) on Sunday told Beijing and Washington thatStrengthen communicationHow Chinese companies should be regulated.
Regulators in both countries need to “appropriately address issues related to oversight of US-listed China-based companies in order to form stable policy expectations and create a favorable regulatory environment. “The CSRC said.
Authorities also sought to surprise investors and calm concerns over Beijing’s crackdown on Chinese companies that led to the sale of a large stock market last week.
In a statement, the CSRC said, “We have always accepted the choice of companies to list their securities on the international or domestic market,” and in close contact with other Chinese authorities, such companies. He added that he would remain transparent about the policies that affect the market.
— Laura He contributed to this report.
The-CNN-Wire
™ & © 2021 Cable News Network, Inc., Warner Media Company. all rights reserved.
SEC temporarily halts approvals of new Chinese IPOs after Didi debacle – KION546 Source link SEC temporarily halts approvals of new Chinese IPOs after Didi debacle – KION546
via Google Alerts , CaliforniaNewsTimes.com
