China plans to classify US-listed Chinese companies based on the sensitivity of the data they hold, in a bid to prevent US regulators from delisting hundreds of companies, groups, the Financial Times reported on Saturday.
The three-tier system aims to bring Chinese companies into compliance with US rules that will require public companies to allow regulators to inspect their audit records, 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 secret data, the newspaper said.
Washington has long demanded full access to the books of Chinese companies listed in the U.S., but Beijing, citing national security concerns, blocks inspection of foreigners’ employment documents by local accounting firms.
Reuters reported in March that Chinese regulators had asked some of the country’s US-listed companies, including Alibaba, Baidu and JD.com, to prepare for more audit disclosures.
Reuters reported in April that China and US regulators were discussing the operational details of a control deal Beijing hoped to sign this year to keep Chinese companies listed on US exchanges.
Source: Capital
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