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How U.S. Is Targeting Chinese Firms for Delisting: QuickTake

May 5, 2022, 1:58 AM

Some big-name Chinese stocks including Alibaba Group Holding Ltd. and Baidu Inc. face the prospect of getting kicked off the New York Stock Exchange and Nasdaq if they refuse to let U.S. regulators see their financial audits. The U.S. Securities and Exchange Commission has started the process, compelled by a 2020 law, and investors have started to pay attention. So has China, which has moved to potentially clear a big hurdle that stymied U.S. regulators for years.

1. Why does the U.S. want access to audits?

The 2002 Sarbanes-Oxley Act, enacted in the wake of the Enron Corp. accounting ...