China has described the US government’s order to delist three Chinese telcos from the New York Stock Exchange (NYSE) as politically motivated and in breach of market rules. It urges need to respect rule of law and safeguard “order of global financial market”.
Outgoing US President Donald Trump had issued an executive order last November prohibiting any trading and investment activities involving companies previously deemed to be Communist Chinese military companies by the US Department of Defense. Trump’s order would ban trading in any new companies 60 days after the US placed such a label on them.
Slated to begin on January 11, the ban would impact three NYSE-listed companies, namely, China Telecom, China Mobile, and China Unicom Hong Kong.
In response, the China Securities Regulatory Commission said Sunday the delisting of the Chinese telcos “disregarded” the “legitimate rights” of global investors and “severely disrupted” market order.
Citing a spokesperson from the commission, state-run media agency China Daily reported that the three Chinese companies had secured American Depositary Receipts and had been listed on the NYSE for almost or more than 20 years. The telcos also had complied with the rules and regulations in accordance with the US securities market.
The China Securities Regulatory Commission spokesperson added that the delisting was politically charged and in serious breach of market rules and order. He said some US politicians had made attempts to suppress US-listed foreign companies at the “cost of damaging” the global standing of the US capital market, describing these moves as random, arbitrary, and “unwise”.
The spokesperson noted, however, that the delisting would have “very limited impact” on the operations and development of the three Chinese telcos, given the companies’ large user base, established operations, influence on the global telecommunications industry, and small volume of American Depositary Receipts in their total shares.
He added that the commission would support the three companies in safeguarding their rights and interests. “We hope the US sides will respect the market and the rule of law and do more to protect the order of the global financial market, safeguard investors’ lawful rights and interests, and promote the steady development of the world economy,” the spokesperson said.
An official of the China Banking and Insurance Regulatory Commission also urged for a stabilising of relationships between China and the US, which would be the “fundamental interests” of both parties as well as meet the expectations of the international society.
It said: “We hope the US government will meet China halfway, uphold the spirit of non-conflict, non-confrontation, mutual respect, and win-win cooperation, promote the healthy development of the China-US relationship, and maintain international financial market stability together with us.”