The New York Stock Exchange (NYSE) canceled Monday its plan to delist three Chinese telecommunication operators, reversing an announcement it made Thursday.
“In light of further consultation with relevant regulatory authorities in connection with Office of Foreign Assets Control, NYSE Regulation no longer intends to move forward with the delisting action in relation to the three issuers which was announced on Dec. 31, 2020,” the Exchange announced in a press release Monday.
The NYSE had originally announced Thursday that it would delist three major Chinese telecommunications operators, including China Mobile, one of China’s most valuable NYSE-listed state-owned enterprises, in compliance with Executive Order 13959. (RELATED: New York Stock Exchange To Delist Major Chinese Telecom Companies, Citing Trump’s Executive Order)
The executive order was set to prohibit from 9:30 a.m. (ET), Jan. 11 onwards, any person in the U.S. from engaging in transactions of “publicly traded securities, or any securities that are derivative of, or are designed to provide investment exposure to such securities, of any Communist Chinese military company.” It was signed by President Donald Trump on Nov. 12.
The NYSE, according to its initial announcement, was to close trading in securities issued by the three firms — China Telecom Corporation Limited (CHA), China Mobile Limited (CHL), and China Unicom Hong Kong Limited (CHU) — 4 .a.m. on Jan.11. If the Depository Trust & Clearing Corp. didn’t confirm to the Exchange that the clearinghouse would settle trades made on Jan. 7 and Jan. 8, the Exchange was to suspend trading four days earlier on Jan. 7.
We have been pushing to protect Americans from the dangers posed by #China investments. Removing Chinese telecom companies from U.S. exchanges is a good start but we still need to pass my American Financial Markets Integrity and Security Act. https://t.co/G4WLF4ZLx6
— Marco Rubio (@marcorubio) January 1, 2021
China vowing a response, responded Saturday that it would “take necessary measures to resolutely safeguard the legitimate rights and interests of Chinese enterprises,” CNBC reported.
Then, on Tuesday, it reiterated that America’s status as a global financial center relied on the confidence that international companies and investors have in the certainty of its rules, according to Reuters.
The direct impact on the Chinese companies targeted will be limited, but the global standing of the US capital market will be greatly damaged.
— Spokesperson发言人办公室 (@MFA_China) January 5, 2021
The NYSE’s reversal, coming in the twilight weeks of Trump’s presidency, highlighted the confusion surrounding the implementation and implications of a U.S. ban on Chinese firms deemed to have military links, Reuters reported.
Hong Kong-traded shares in the three companies had surged following the reversal’s news, according to further reporting from Reuters. The NYSE move also briefly raised the yuan to a new 30-month high, as markets saw it as a form of easing geopolitical tensions.