Including China Life Insurance (LFC-US)(601628-CN) and oil giant Sinopec (SNP-US)(600028-CN), including several Chinese state-owned enterprises, on Friday (12th) announced plans to delist from the US stock market.
These companies also include Aluminum Corporation of China (Chalco) (ACH-US)(601600-CN) and PetroChina (PTR-US)(601857-CN), each individually issued statements that they would apply to delist their American Depositary Shares (ADS) from the New York Stock Exchange (NYSE).
The four companies will continue to be listed on the Hong Kong and Chinese stock exchanges.
The China Securities Regulatory Commission said in a statement: “Since their listing in the US, these companies have strictly abided by the rules and regulatory requirements of the US capital market, and made delisting choices out of their own business considerations.”
China and the U.S. have been in talks to resolve a long-standing audit dispute, and failure to comply with U.S. auditing rules might see Chinese companies kicked out of U.S. exchanges.
The companies were placed on the Foreign Corporation Accountability Act (HFCAA) list in May following they were determined to not meet U.S. regulators’ auditing standards. Statements from China Life and Sinopec on Friday did not directly mention the audit dispute.
All four companies said their U.S. equities traded very little compared to other major listing venues.
PetroChina noted in its statement that there is a “considerable administrative burden” in fulfilling the disclosure obligations necessary to list its ADSs on the NYSE due to differences in the rules of many listed exchanges.
China Life and Aluminum Corporation of China said they would apply for delisting on August 22, and the delisting would take effect 10 days later. Sinopec and PetroChina said their applications would be filed on August 29.