Some Chinese State Companies are Preparing to Delist from NYSE

Several Chinese state-owned companies, including China Life Insurance and oil giant Sinopec (NYSE:SHI), announced plans to delist from the US stock market on Friday.

In separate statements, the companies, including Aluminum Corporation of China (Chalco) and PetroChina, said they would apply to delist their American Depositary Shares from the New York Stock Exchange (NYSE). These four companies will continue to be traded in Hong Kong and mainland China. "These companies have strictly complied with the rules and regulatory requirements of the US capital market since their listing in the US and have chosen to delist based on their own business considerations," the China Securities Regulatory Commission (CSRC) said in a statement. China and the United States are in talks to resolve a long-running supervisory dispute that could result in Chinese companies being kicked off American exchanges if they fail to comply with US supervisory rules. The companies were added to the Holding Foreign Companies Accountable Act (HFCAA) list in May after US regulators found they failed to meet audit standards. The audit disputes were not directly mentioned in the companies' separate statements on Friday. All four companies said their share volumes traded in the US were small compared to those in other major listing venues. PetroChina said in a statement that it was a "significant administrative burden" to fulfill the disclosure obligations required to maintain its ADS listing on the NYSE due to differences in the rules of multiple listing venues. China Life and Chalco said they will apply to delist on August 22 and the delisting will take effect 10 days later. Sinopec and PetroChina said their applications will be filed on August 29.