The potential delisting of Chinese companies from U.S. stock exchanges is being discussed as a new pressure tactic in the ongoing trade war between the United States and China. According to Politico, discussions on this measure were underway. There are 286 Chinese companies listed on U.S. stock markets, with a combined market capitalization of approximately 1.1 trillion USD.
U.S. Treasury Secretary Scott Bessent recently mentioned this possibility in an interview, stating that everything is “on the table.” Kevin O’Leary, a businessman close to President Donald Trump, also suggested delisting to pressuring China to return to the negotiating table.
Senator Rick Scott criticized the list of candidates for the Securities and Exchange Commission (SEC) chairmanship, pointing out that Chinese companies accessing U.S. capital while not complying with domestic regulations is problematic. These statements indicate that the U.S. is considering a hard-line stance against Chinese firms.
Politico reported that it is unclear how deeply these discussions are being pursued. However, the attention given to this issue demonstrates that the U.S. is exploring various options in addressing the trade conflict.
Currently, there are various ways to delist Chinese companies from U.S. markets. The Holding Foreign Companies Accountable Act (HFCAA) includes provisions for delisting foreign firms that fail to comply with U.S. accounting standards. While this law targets companies that do not meet specific conditions, the process can be time-consuming. Trump could also issue an executive order citing national security concerns to expedite the process.
Chinese companies have long used the Variable Interest Entity (VIE) structure to circumvent domestic regulations and raise capital in U.S. markets. Measures to ban the use of such structures are also being considered. However, any such action could heighten uncertainty in financial markets, exacerbating the already unstable situation caused by tariff policies.
Meanwhile, Liu Pengyu, spokesperson for the Chinese Embassy in the United States, warned that excluding the Chinese market would negatively impact the U.S. economy.
