Chinese regulators on April 2 published a draft proposal seeking to ease confidentiality restrictions for companies with offshore listings. The move is part of an effort to avoid new U.S. rules that will begin forcibly delisting companies from New York in 2024 if their audits cannot be fully inspected by the U.S. Public Company Accounting Oversight Board.
The plan from the China Securities Regulatory Commission would drop a requirement that onsite inspection of overseas-listed Chinese companies be conducted mainly by Chinese regulators. It also makes clear that Chinese companies are responsible for information security in overseas listings to lower the risk that confidential information unnecessarily enters auditors' working papers.
U.S. regulators in March began naming Chinese companies at risk of delisting. Eleven of them, including internet search giant Baidu, have been added to the list.FILE PHOTO: U.S. President Joe Biden holds virtual talks with Chinese President Xi Jinping from the Situation Room at the White House in Washington, U.S., March 18, 2022. The White House/Handout via REUTERS. THIS IMAGE HAS BEEN SUPPLIED BY A THIRD PARTY.