China May Use Tiered-Data Strategy to Prevent US Delistings: FT

(Bloomberg) --

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China is looking at ways to sort its US-listed companies according to sensitivity of data they hold as it strategizes keeping the firms in compliance with US regulators and avoid delisting, the Financial Times reported.

The companies would be grouped into three categories -- those with non-sensitive data, those with sensitive data and others with secretive data that would have to delist, the report said, citing unidentified people with knowledge of the situation. The plan is under discussion and subject to change, the paper said.

There is a congressionally imposed deadline of a 2024 for kicking businesses off the New York Stock Exchange and Nasdaq Stock Market unless American regulators get full access to inspect their audit work papers. The US and China have been at odds for two decades over the legal requirement, which is meant to protect investors from accounting frauds and other financial malfeasance.

The China Securities Regulatory Commission didn’t comment to the FT.

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