China to take action against NYSE move to delist telcos
The Chinese government plans to take "necessary countermeasures” to safeguard the interests of its companies, according to reports.
This after the New York Stock Exchange (NYSE) announced its plans last week to begin a process of delisting three Chinese telecom firms that allegedly have military ties.
The NYSE has indicated that it would delist China Mobile, China Unicom and China Telecom, with trading to be suspended by 11 January.
This action follows president Donald Trump’s move last November to bar US investment in firms the US government says are owned or controlled by the Chinese military, Reuters reports.
“China opposes the Americans from abusing national security by listing Chinese companies into the so-called ‘Communist China Military Companies’ list and will take the necessary countermeasures to resolutely safeguard the legitimate rights and interests of Chinese companies,” a spokesperson for the Chinese Commerce Ministry is quoted.
The latest announcement comes amid ongoing tensions between the US and China – the world’s biggest economies.
According to Reuters, the US Commerce Department added dozens of Chinese companies to a trade blacklist in December, accusing Beijing of using its firms to harness civilian technologies for military purposes.
As a result, Chinese diplomats have expressed hope that president-elect Joe Biden’s election will help ease tensions between the two countries.
Responding to the delisting of the three major Chinese telcos, a spokesperson for China’s Securities Regulatory Commission (CSRC) says they have taken note of this development.
“With their American Depositary Receipts issued and traded on the NYSE for about two decades, the three Chinese telecom companies have always adhered to market rules and regulatory requirement of the US securities markets and have been widely recognised by global investors.”
The spokesperson reiterates the move to delist the telecoms firms stems from the executive order of the Trump administration.
“The executive order, which is based on political purposes, have entirely ignored the actual situations of relevant companies and the legitimate rights of the global investors, and severely damaged market rule and order.”
The CSRC spokesperson adds: “The role of the US as an international financial centre is built on the trust of the global enterprises and investors in the inclusiveness and certainty of its rules and institutions. The recent move by some political forces in the US to continuously and groundlessly suppress foreign companies listed on the US markets, even at the cost of undermining its own position in the global capital markets, has demonstrated that US rules and institutions can become arbitrary, reckless and unpredictable.
“It is certainly not a wise move. We hope that the US side could show respect for the market and reverence for the rule of law, do more things that can benefit the order of global financial markets, the legitimate rights of investors, and the stability and development of global economy.”