WASHINGTON – Sen. John Kennedy (R-La.) today asked the U.S. Securities and Exchange Commission (SEC) acting chairman, Allison Herren Lee, to provide updates to Congress on the implementation of the Holding Foreign Companies Accountable Act.
“Legislation rarely moves through both chambers of Congress in as unanimous and bipartisan a fashion as the Holding Foreign Companies Accountable Act did. As you move to implement the remainder of the law, I ask that you provide Congress with updates on how the Commission intends to do so and when you plan for the law to be fully implemented. It is time to demand honesty of all companies on U.S. exchanges. That means that foreign companies comply with our laws or be forced off our exchanges,” wrote Kennedy.
The Holding Foreign Companies Accountable Act protects American investors and their savings from foreign companies that operate on U.S. stock exchanges but refuse to submit to SEC oversight. The law is tailored to address challenges the Public Company Accounting Oversight Board (PCAOB) has regulating Chinese companies listed on U.S. exchanges because China denies the PCAOB access.
The Holding Foreign Companies Accountable Act also mandates several enhanced disclosure requirements. Companies must report whether a foreign government controls them, whether officials of the Chinese Communist Party serve on their board and whether government entities own any share in the company. The purpose of these and other disclosure requirements is to make relevant information about publicly traded firms explicit and easily accessible to investors.