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China plans three-tier data strategy to avoid U.S delistings - FT

Published 07/24/2022, 02:21 AM
Updated 07/24/2022, 02:45 AM
© Reuters.
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(Reuters) - China plans to sort U.S.-listed Chinese companies based on the sensitivity of the data they hold in an attempt to stop U.S. regulators from delisting hundreds of firms, the Financial Times said on Saturday.

The three-tier system aims to bring Chinese companies into compliance with U.S. rules that would require public companies to let regulators inspect their audit files, the FT said, citing four unnamed people with knowledge of the situation.

The three broad categories include companies with non-sensitive data, sensitive data and secretive data, the newspaper said.

Reuters could not immediately reach the CSRC for comment during non-business hours on Sunday.

Washington has long demanded complete access to the books of U.S.-listed Chinese companies, but Beijing, citing national security concerns, bars foreign inspection of working papers from local accounting firms.

Reuters reported in March that Chinese regulators had asked some of the country's U.S.-listed firms, including Alibaba (NYSE:BABA) Group Holding Ltd, Baidu Inc (NASDAQ:BIDU) and JD (NASDAQ:JD).com Inc to prepare for more audit disclosure.

In April, Reuters reported China and U.S. regulators were discussing operational details of an audit deal that Beijing hoped to sign this year to keep Chinese companies listed on U.S. exchanges.

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