The New York Stock Exchange has cancelled plans to delist three Chinese telecoms companies. Earlier, China’s Commerce ministry threatened to retaliate against the New York Stock Exchange for its planned delisting.
In a statement Monday night, the New York Stock Exchange said it no longer plans to proceed with the Delisting of three Chinese telecommunications companies announced Dec. 31 in light of further guidance from the U.S. Treasury Department’s Office of Foreign Assets Control on questions and answers on sanctions against Chinese military companies. The adRS of the three companies will continue to trade on the Nyse platform and the exchange will continue to evaluate the applicability of Executive Order 13959 to the three Chinese companies, the statement said.
The executive order, issued by President Donald Trump on November 12, 2020, prohibits Americans from investing in any securities of Communist Party military companies starting January 11, 2021. On Dec. 28, the Ministry of Finance issued a question-and-answer message on the imposition of sanctions against Communist Party military enterprises under the executive order. It is unclear what additional guidance the Treasury Department provided prompted the NYSE’s decision to stop delisting the three Chinese telecom companies.
A day earlier, a spokesman for the China Securities Regulatory Commission (CSRC) issued a statement Sunday in response to the New York Stock Exchange’s announcement that it had begun delisting three telecom operators, including China Mobile, saying that “the U.S. has implemented an executive order for political purposes to unjustifably suppress foreign companies listed in the U.S., which seriously undermines normal market rules and order.” ‘The total size of the ADRs of the three companies in the U.S. is less than 20 billion yuan, accounting for less than 2.2% of the company’s total equity, and even if delisted in the U.S., the direct impact on the company’s development and market operation is quite limited,’ the statement added.
China’s Ministry of Commerce earlier objected to the New York Stock Exchange’s announcement that three Chinese telecommunications companies were to be de-listed, saying it was opposed to the US “abusing national security” by adding Chinese companies to its list of “Communist Chinese military companies” and that “necessary measures will be taken to resolutely safeguard the legitimate rights and interests of Chinese companies.”
In addition to the New York Stock Exchange, major global stock index providers MSCI Inc., S&P Dow Jones Industrial Average inc., FTSE Russell Holdings Inc. and Nasdaq Inc. have all removed some Chinese companies from their indexes.
Over the past year, RELATIONS between the U.S. and China have deteriorated sharply following The novel Coronavirus pandemic outbreak, Beijing’s push for a national security law in Hong Kong and escalating tensions in the South China Sea.
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