Hong Kong: The US government is just one step away from enacting a law that could 'kick' several Chinese firms off Wall Street, which can further escalate tensions between Washington and Beijing.
The House of Representatives on Wednesday passed a bill that would prevent companies that refuse to open their books to US accounting regulators from trading on US Stock exchanges, which only needs President Donald Trump's signature to become law, reported CNN.
Though the bill would apply to any foreign country, the focus on China is obvious, as Beijing has resisted such scrutiny. All US-listed public companies would also be required to disclose whether they are owned or controlled by a foreign government, including China's Communist Party.
Read:|US House passes bill on scrutinising Chinese companies
According to CNN, the bipartisan co-sponsors of the legislation said earlier this year that their goal was to 'kick deceitful Chinese companies off US exchanges'. The US scrutiny intensified following a scandal involving Luckin Coffee, the Chinese coffee firm that disclosed massive accounting irregularities this spring. It was kicked off at the NASDAQ in June.
Politicians from both parties in the US have criticised China's lack of transparency in its financial system, saying it could be putting American investors at risk of fraud.
This legislation would give Trump yet another way to put pressure on China before he leaves office in January.