Sherman, Van Hollen, Gonzalez Applaud Holding Foreign Companies Accountable Act’s Signing into Law
WASHINGTON – Today, Congressman Brad Sherman (D-Sherman Oaks), U.S. Senator Chris Van Hollen and Congressman Anthony Gonzalez (R-Ohio) released the following statements regarding the signing of their bipartisan Holding Foreign Companies Accountable Act into law.
“This may be the most significant piece of investor protection legislation passed in several years,” said Congressman Sherman, Chair of the Investor Protection and Capital Markets subcommittee. “It is designed to assure U.S. investors of financial statement integrity, when they invest in any of 224 U.S. exchange-listed companies with over $1.8 trillion in market capitalization. The purpose is not to de-list any company, but to persuade China to allow the audit oversight that U.S. investors need, and the U.S. investors get when investing in U.S. companies or companies in over 50 foreign jurisdictions.”
“It’s our job to protect American investors from fraudulent businesses seeking to take advantage of them. Requiring all publicly listed companies on our U.S. exchanges to be held to the same standards is the best way to do that. Taking this action is crucial to hold Chinese companies accountable and to safeguard the millions of American families who rely on modest investments to retire, send their kids to college, and weather financial emergencies. I’ve been proud to lead this this bipartisan effort, and I’m glad to see the President sign it into law today. I will continue fighting to improve our financial system and ensure it puts the American people first,” said Senator Van Hollen, who co-authored the legislation in the Senate.
“The Holding Foreign Companies Accountable Act is about ending the practice of companies based in China, some fully controlled by the Chinese Communist Party, from taking advantage of a loophole in securities law to fund their enterprises. Simply put, if a company wants access to US capital markets, they should follow US securities laws. I am pleased to see this bill be signed into law, and I look forward to continuing to work alongside my colleagues to hold the CCP accountable and protect our investors and businesses,” said Congressman Gonzalez.
The Holding Foreign Companies Accountable Act – led by Congressmen Sherman and Gonzalez and Senators Van Hollen and John Kennedy (R-La.) prohibits securities of a company from being listed on any of the U.S. securities exchanges if the company has failed to comply with the Public Company Accounting Oversight Board’s (PCAOB) audits for three years in a row. The bill would also require public companies to disclose whether they are owned or controlled by a foreign government, including China’s communist government. The text of the legislation is available here.