In the News: US Takes Steps to Tighten Listing Rules; Outbound Investment Cap Lifted; and EU Restricts Market Access For Chinese Medical Device Manufacturers
U.S. to tighten disclosure obligations of foreign listed companies, targeting China; China to allow local investors to invest more in overseas assets under QDII; and EU issues measures to restrict Chinese medical device manufacturers from accessing public procurement contracts
US Takes Steps to Tighten Obligations of Foreign Listed Companies
The U.S. securities regulator has moved forward with plans to tighten obligations of foreign companies listed on U.S. stock exchanges, saying many Chinese companies have benefited from having to make fewer regular disclosures to investors, Reuters reports.
The U.S. Securities and Exchange Commission has called for public comment on new regulations it intends to introduce that would narrow the definition of those foreign companies, known as foreign private issuers, that are subject to less stringent requirements than their U.S. counterparts. American companies trading on domestic stock exchanges are obliged to follow all U.S. securities laws, “including quarterly financial reporting, proxy solicitation rules and prompt disclosure of events such as mergers and the departures of board members,” whereas foreign private issuers are only required to publish annual reports and occasional updates. The vote in favor of proceeding with public comment was unanimous.
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