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US outlines plan to delist China firms not meeting audit standards

The New York Stock Exchange building is seen in New York's financial district on March 22, 2020. (Anadolu Agency/Getty/Kyodo)

WASHINGTON (Kyodo) -- An advisory group of President Donald Trump's administration said Thursday that Chinese companies listed on U.S. stock exchanges should be delisted unless they comply with American audit requirements by the start of 2022, a proposal that could fuel tensions between the world's two largest economies.

    Trump has said Chinese firms operating in the United States have not complied with investor protection rules, and instructed his officials to consider measures to protect investors.

    "The recommendations outlined in the report will increase investor protection and level the playing field for all companies listed on U.S. exchanges," Treasury Secretary Steven Mnuchin, who heads the group, said in a press release.

    Chinese firms already listed in the United States need to ensure that the U.S. accounting watchdog, the Public Company Accounting Oversight Board, has sufficient access to their audit documents by Jan. 1, 2022, according to the recommendations.

    The Senate has separately passed a bill that would delist companies refusing to accept inspections by the PCAOB for three straight years.

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