Securities regulator: US bill can cause 'severe damage'

The bill passed by the US House of Representatives on Wednesday that could block Chinese companies from US stock markets can cause "severe damage" to global investors, China's top securities regulator said on Friday.

The bill has rules "clearly discriminative" against Chinese companies that are not in line with professional securities regulation, the China Securities Regulatory Commission said in a statement.

"Forcing Chinese companies to delist from US securities markets under these rules will cause severe damage to the interests of US investors and even global ones," the commission said.

The bill, named the Holding Foreign Companies Accountable Act, proposed delisting foreign companies from US exchanges if the US Public Company Accounting Oversight Board cannot inspect their audit firms for three consecutive years.

Foreign issuers whose audit firms are not subject to the PCAOB’s inspection have to certify that they are not owned or controlled by a foreign government and disclose information related to any board members who are officials of the Communist Party of China, the bill said.

The fact that US regulators are now unable to inspect the Chinese audit firms is an issue of cross-border regulatory cooperation and should be resolved by strengthening bilateral regulatory cooperation, the CSRC said.

"China is always open toward addressing the concerns of the US side via dialogue and cooperation," the commission said, adding that it looks forward to bilateral consultations about specific solution schemes, based on the principle of mutual respect.