The New York Stock Exchange (NYSE).
Photographer: Michael Nagle / Bloomberg
Photographer: Michael Nagle / Bloomberg
The New York Stock Exchange said it will withdraw three Chinese corporations to comply with a U.S. executive order that imposed restrictions on companies identified as affiliated with the Chinese military.
China Mobile Ltd., China Telecom Corp. Ltd., China Unicom Hong Kong Ltd. will be suspended from trading between Jan. 7 and 11 and procedures to withdraw them have begun, according to a statement from the plant.
The three companies have separate listings in Hong Kong. They all generate all of their revenue in China and have no significant presence in the United States except for their tokens there.
U.S. President Donald Trump signed an order in November banning U.S. investments in Chinese-owned or military-controlled companies, with the goal of pressuring Beijing over what it considers abusive trade practices. The order prohibited U.S. investors from buying and selling shares of a list of Chinese companies designated by the Pentagon as a military binding.
Later, the Chinese Foreign Ministry accused the US of “brutally defaming” its civil-military integration policies and promised to protect the country’s companies. Chinese officials have also threatened to respond to previous actions by the Trump administration with its own blacklist of U.S. companies.
The executive order has led to the elimination of a number of companies indices compiled by MSCI Inc., S&P Dow Jones Global Indexes and FTSE Russell.
Global exchanges, including NYSE and Nasdaq Inc., have been celebrating Chinese companies for the past decade as they try to expand their IPO business, particularly in the Internet sector. In response, Hong Kong Exchanges & Clearing Ltd. changed his the rules of recent years to attract listings, including the ability to sell shares by weighted voting companies, strengthening the power of business founders at the expense of weaker protection for minority investors.
Companies including e-commerce giants Alibaba Group Holding Ltd. and JD.Com Inc., which already had listings in New York, conducted secondary listings in Hong Kong in the past two years as the U.S.-China trade war intensified.
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