Chairman of the U.S. Securities and Exchange Commission: Temporarily suspend Chinese companies from using shell companies to go public in the U.S.

It is learned that according to Bloomberg, Gary Gensler, chairman of the U.S. Securities and Exchange Commission (SEC), recently issued a statement that American investors know little about some Chinese companies listed on U.S. stock exchanges. He has asked SEC staff to "temporarily suspend" the IPOs of shell companies used by Chinese companies to list in the United States, and hopes that investors will learn more about the company structure.

Gary Gensler reiterated a demand that U.S. officials must be allowed to inspect the financial audits of Chinese companies. Gary Gensler said that within the next three years, if the auditors of Chinese operating companies do not make their books and records public, then companies registered in the Cayman Islands or China will not be able to list in the United States.

It is learned that as early as July 30, Reuters reported that the SEC had stopped processing registrations for IPOs and other securities sales of Chinese companies in the United States. But at that time, the SEC did not respond positively.

Gary Gensler further stated that in view of recent developments in China and the overall risks of China's VIE structure, SEC staff is required to make additional disclosure requirements for overseas issuers related to Chinese entity operating companies (offshore shell companies) before they go public in the United States through VIE.

Editor ✎ Nicole/

Disclaimer: This article is copyrighted and may not be reproduced without permission.