Image Source: Visual China
BEIJING, April 1 (TMTPOST) — The U.S. Securities and Exchange Commission (SEC) added iQiyi (NASDAQ:IQ) and four other Chinese companies to a list of companies that might be delisted from the stock market in the U.S.
The company has responded to the news report, saying that being added to the list does not mean that it will be delisted from the stock market. The streaming company said that the recent development is a standard procedure in the Holding Foreign Companies Accountable Act that was announced previously by American regulators.
“Being added to the temporary list does not mean that the company will be delisted from the American stock market,” the company said. “We will make active efforts in finding relevant solutions and protect the interest of the shareholders.”
iQiyi said in a statement that the addition to the list might be caused by the 20-F form filed with the SEC.
The Holding Foreign Companies Accountable Act mandates that companies that fail to deliver annual auditing reports assessed by the Public Company Accounting Oversight Board for three consecutive years to be delisted from the stock market in the United States.
The spokesperson of China Securities Regulatory Commission said on Thursday that information from the U.S. SEC shows that being added to the list is a standard procedure under the Holding Foreign Companies Accountable Act. Whether the companies on that list will be delisted from the stock market in the United States will be determined by the progress and result of the auditing cooperation between Chinese and American regulators, the spokesperson said.
The Holding Foreign Companies Accountability Act is a 2020 law that requires companies publicly listed on stock exchanges in the United States to declare they are not owned or controlled by Chinese government. The statute prohibits the trading of non-US companies on the stock market in the United States if they cannot provide accounting access to U.S. regulators for three consecutive years.
