Three Republican congress members have introduced a bill that would ban blacklisted Chinese companies and their affiliates from accessing U.S. capital markets.
The legislation, known as the American Financial Markets Integrity and Security Act, would apply to Chinese companies that have been named in either the commerce department’s “entity list” or the defense department’s list of Chinese companies that are owned or controlled by the Chinese military.
The bill was introduced by Reps. Liz Cheney (R-Wyo.), Chris Stewart (R-Utah), and Mike Gallagher (R-Wis.).
She added: “This legislation is a critical step toward making sure that CCP military companies can no longer exploit U.S. markets in support of China’s pernicious power projection, nuclear build-up, grave human rights abuses, and other malign activities.”
If passed, the bill would also empower the Securities and Exchange Commission (SEC) to ban these Chinese companies from “offering to sell or selling securities” on U.S. security exchanges.
It would also ban investment firms, insurance companies, and retirement funds from investing in these Chinese companies.
Furthermore, federal funds would not be allowed to “enter into, extend, or renew a contract or purchasing agreement” with these Chinese companies, according to the bill.
The bill also introduces an amendment to section 1237(b) of the 1999 NDAA, which would allow either the Secretary of Defense, Secretary of Commerce, or the Director of National Intelligence to add new entities to the list of Chinese companies linked to the Chinese military. The amendment also stipulates that an agreement from all three secretaries is needed to remove a Chinese company from the list.
In 2017, Beijing established a government agency called the Central Commission for the Development of Military-Civil Fusion to oversee cooperation between the military and private industry to advance technology innovations.
Meanwhile, the SEC is moving forward with a regulatory plan to force Chinese companies to comply with U.S. auditing rules or else be delisted from U.S. stock exchanges, according to a recent report by Bloomberg, citing unnamed people familiar with the plan.