China’s Alibaba said on Monday it was working to maintain its listing on the New York Stock Exchange, after it was placed on a delisting watchlist by authorities.
Under the Holding Foreign Companies Accountable Act, the Securities and Exchange Commission can remove foreign companies from U.S. exchanges if they fail for three consecutive years to comply with American standards for auditing.
The e-commerce giant on Friday became the latest of more than 270 Chinese firms listed in New York at risk of being kicked out, over not meeting those auditing requirements. U.S. regulators have been demanding complete access to audit working papers of New York-listed Chinese companies, which are stored in China.
But Beijing bars foreign inspection of working papers from local accounting firms. The new rules give Chinese companies until early 2024 to comply with auditing requirements. But Congress is weighing bipartisan legislation that could accelerate the deadline to 2023.