Published On: Tue, Jul 27th, 2021

US-Listed Chinese Companies Must Disclose Government Interference Risks–SEC Official

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WASHINGTON—Chinese companies listed on U.S. stock exchanges must disclose the risks of the Chinese government interfering in their businesses as part of their regular reporting obligations, a top U.S. Securities and Exchange Commission (SEC) official said on July 26. Democratic commissioner Allison Lee’s comments are the first by an SEC official since Chinese regulators launched a massive cyber probe of ride-hailing giant Didi Global Inc. last week, just days after its $4.4 billion New York listing, wiping 25 percent off its share price. Chinese authorities have clamped down on other U.S.-listed Chinese companies and may require tutoring firms to become non-profits, according to a Bloomberg report that hit shares in the sector, including New York-listed TAL Education Group and Gaotu Techedu Inc. Some policymakers worry Chinese firms are systematically flouting U.S. rules, which require public companies to disclose to investors a range of potential risks to their businesses. “Public companies …

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