A Study on Internet Chinese Companies’ Response to “The Holding Foreign Companies Accountable Act”

Guowei Chen, Shulin Ruan () and Xiaotong Wang
Additional contact information
Guowei Chen: Jiangxi University of Finance and Economics, Accounting Institute
Shulin Ruan: Shanghai Maritime University, School of Economics and Management
Xiaotong Wang: Changsha University of Science & Technology, School of Economics and Management

A chapter in Proceedings of the 2023 3rd International Conference on Financial Management and Economic Transition (FMET 2023), 2024, pp 95-109 from Springer

Abstract: Abstract At the beginning of the 21st century, a large number of Chinese companies went public in the United States due to many advantages such as easier access to financing, better corporate governance structure, and different listing conditions. However, in January 2020, with the disclosure of a short-selling report on Luckin Coffee’s year-long financial data falsification and fraud, Luckin Coffee’s trading was officially suspended on NASDAQ in June 2020, accompanied by a high level of concern from international capital markets about Chinese stocks. Within the following year, the US Senate introduced the Foreign Company Accountability Act, which tightened securities market regulations at the legal level and raised the threshold for companies from “unenforceable inspection” regions, including China, to list in the US. Data shows that more than 90% of the listed companies facing mandatory delisting as a result of the Foreign Company Accountability Act are Chinese companies. This paper provides a preliminary behavioral analysis of Chinese stocks by examining the paths taken by several Chinese stocks in response to the conflicting effects of the Foreign Company Accountability Act and the Chinese corporate system, and the subsequent results achieved.

Keywords: Internet Chinese Companies; The Holding Foreign Companies Accountable Act; Event Study (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-272-9_11

Ordering information: This item can be ordered from
http://www.springer.com/9789464632729

DOI: 10.2991/978-94-6463-272-9_11

Access Statistics for this chapter

More chapters in Advances in Economics, Business and Management Research from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().