Homebound: China, US Listing Reforms in 2021

January 14, 2022 | BY

Vincent Chow

Chinese IPOs in the United States have slowed for several years now, but a raft of regulatory developments in the past year mainly driven by cybersecurity and national security concerns have likely rung the closing bell

Visitors walk past a sign for Chinese ride-hailing service Didi Chuxing at the Global Mobile Internet Conference (GMIC) in Beijing on April 27, 2017. Photo: Mark Schiefelbein/AP

Summary

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  • U.S. SEC demands more disclosures from Chinese issuers, emphasis on regulatory risks, VIE status
  • China establishes overseas listing framework, brought under Negative List regime
  • Hong Kong paving return of US-listed firms, but cybersecurity review uncertainties linger

The slowdown in the United States listings pipeline has finally reached the regulatory front as both China and U.S. regulators erected concrete barriers to Chinese companies listing stateside in 2021. With China eager to protect the data security of its biggest and most influential companies on the one hand, and the U.S. keen to uphold corporate reporting standards on the other, the listings landscape for Chinese firms is tilting toward the mainland China and Hong Kong markets.

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