China Tells SOEs to Inspect Overseas Compliance Risks
What’s new: China’s state-owned assets supervisor told central government-owned enterprises to conduct regular inspections of their overseas compliance risks and take risk control measures as Chinese state-owned companies face increasing scrutiny and sanctions in the U.S. and elsewhere.
The inspections will focus on high-risk areas such as investment access, capital markets and intellectual property rights, said Wong Jieming, vice chairman of the State-owned Assets Supervision and Administration Commission (SASAC), Thursday at a media briefing.
To prevent related risks, some central government-owned enterprises, including China Nonferrous Metal Mining Group, China Communications Construction Group, China Three Gorges Corp., and China National Cereals, Oils and Foodstuffs Corp., have compiled a negative list of investments, built a legal risk-prevention database, and involved legal personnel deeply in major overseas investment projects, according to SASAC.
Central government-owned enterprises currently have more than 8,000 projects in more than 180 countries. During the five years from 2016 to 2020, the overseas operating revenue of these enterprises reached 23 trillion yuan ($3.56 trillion), accounting for about 16% of their total revenue, according to SASAC.
The background: A slew of Chinese state-owned and state-backed companies face delisting of their American depositary shares under an executive order signed in November by former U.S. President Donald Trump barring U.S. entities from investing in companies believed by the government to have ties to the Chinese military.
China’s three major wireless carriers — China Mobile Ltd., China Unicom (Hong Kong) Ltd. and China Telecom Corp. Ltd. — lost appeals of a New York Stock Exchange decision to delist their shares, a signal that the Biden administration is likely to maintain the investment ban.
Quick Takes are condensed versions of China-related stories for fast news you can use. To read the full story in Chinese, click here.
Contact reporter Denise Jia (email@example.com) and editor Bob Simison (firstname.lastname@example.org)
Download our app to receive breaking news alerts and read the news on the go.
Get our weekly free Must-Read newsletter.
- MOST POPULAR