An important agreement was reached, a major breakthrough for the Chinese giants


At the end of 2020, the “Holding Foreign Companies Accountable Act” was introduced overseas, which allows the US Securities and Exchange Commission (SEC) to delist Chinese companies from US stock exchanges if the companies do not comply with their audit obligations for three consecutive years . For example, Alibaba has been vetoed several times by the stock exchange supervision in the area of ​​transparency, due to regulatory rigor – and of course many other circumstances – has had a particularly bad year on the stock markets so far the shares of the Chinese tech giants, Alibaba, for example, fell 17.5 percent this year.

However, as the latest development, the China Securities Regulatory Commission and the US Public Company Accounting Oversight Board (PCAOB) announced on Friday that the parties signed a cooperation agreement on auditing documents of Chinese companies listed on the American stock exchange, the agreement was also signed by the Chinese Ministry of Finance.

This is undoubtedly a breakthrough in regulation

formulated the Goldman Sachs analyst team, however, cautioned that there is still a lot of uncertainty. They pointed out that according to the PCAOB, the agreement is only the first step, while the Chinese side says so formulatedto offer assistance during inspections.

The PCAOB said it plans to have auditors arrive in China by mid-September and determine in December whether China continues to block access to audit information.

Analysts at Goldman Sachs said today that their model

suggests that the market has about a 50 percent probability of pricing it in

that Chinese companies can be delisted in the United States – this compared to the 95 percent measured in mid-March, it is obviously much more favorable.

Cover image: Getty Images


Source: Portfolio.hu – Befektetés by www.portfolio.hu.

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