A MAN wears a protective mask as he walks on Wall Street in New York City, New York, US, March 13, 2020. — REUTERS
THE US Securities and Exchange Commission (SEC) added over 80 firms, including China’s JD.com, to a list of entities facing possible expulsion from American exchanges amid a long-running auditing standoff between the United States and China.
On Wednesday, the SEC expanded the list on a provisional lineup under a 2020 law known as The Holding Foreign Companies Accountable Act (HFCAA), which aims to remove foreign-jurisdiction companies from US bourses if they fail to comply with American auditing standards for three years in a row.
In the long-drawn dispute, US regulators have been demanding complete access to audit working papers of New York-listed Chinese companies, which are stored in China.
The request has so far been denied by China on national security grounds, but regulators in the two countries are discussing operational details of an audit deal that Beijing hopes to sign this year.
JD.com said on Thursday it is aware that the company has been identified by the SEC under the Act, and that it has been actively exploring possible solutions.
“The company will continue to comply with applicable laws and regulations in both China and the United States, and strive to maintain its listing status on both Nasdaq and the Hong Kong Stock Exchange,” JD.com said in a statement.
Other large Chinese companies that were added to the SEC’s list were JinkoSolar Holding Co Ltd., China Petroleum & Chemical Corp., Bilibili Inc., and NetEase Inc., among others.
Sources had told Reuters in March Chinese regulators had asked some of the country’s US-listed firms, including Alibaba, Baidu, and JD.com, to prepare more audit disclosures. — Reuters