Chinese Oil Giants, PetroChina, Sinopec to Delist from New York Stock Exchange

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Chinese state-controlled oil giants, Sinopec and PetroChina are among five Chinese firms that have signaled to delist from the New York Stock Exchange. The other two are China Life Insurance and Aluminium Corporation of China (Chalco).

While they are applying to delist their American Depository Shares this month, they will keep their listings in Hong Kong and mainland China, a report said last Friday.

It will be recalled that in May, the U.S. Securities and Exchange Commission (SEC) flagged the five companies and many others as failing to meet U.S. auditing standards.

The companies did not mention the dispute in their announcements, which come as tensions mounted after U.S. Speaker Nancy Pelosi visited Taiwan.

China and the US are in talks to resolve a long-running audit dispute which could result in Chinese companies being banned from U.S. exchanges if China does not comply with Washington’s demand for complete access to the books of U.S.-listed Chinese companies.

In a release issued last weekend, PetroChina confirmed that it had notified the NYSE of its decision and would file with the SEC on or about August 29 a form to delist its ADSs from the NYSE.

Among the many business reasons for seeking delisting of its ADSs, PetroChina cited “the considerable administrative burden for performing the disclosure obligations as necessary for maintaining the listing of the ADSs on the NYSE as a result of the differences in the regulatory rules of multiple listing venues.”

Commenting on the plans for delisting, an official at the China Securities Regulatory Commission (CSRC) said that “According to these companies’ announcements, they have strictly observed relevant U.S. rules and regulations since listed on the U.S. markets, and the delisting decisions are out of their business considerations.

“These companies are listed on multiple markets, and only a small portion of their securities are traded in the U.S. markets. The delisting plan will not jeopardize these companies’ fund-raising ability through domestic and overseas capital markets,” the official added.

The official said Chinese securities commission will continue to communicate and cooperate with relevant overseas regulators “to jointly protect the legitimate rights and interests of issuers and investors.”

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