US Senator Marco Rubio is reportedly preparing a bill that is aimed at blocking some Chinese companies from listing on the country's capital markets. The bill proposed by the Republican government official will specifically be targeting Chinese companies accused of espionage, human rights violations, and ties to the Chinese military.
Rubio, who is known for his hard-line stance on China, announced that he should be unveiling the new bill within the next few weeks. If it is passed, it will likely deal a massive financial blow to the 20 companies that are included in the US Department of Defense's list. The agency alleges that the companies on its list, which include Huawei Technologies, ZTE, and Hikvision, are being controlled by the Chinese Communist Party.
Former White House official, Roger Robinson, had stated last week that 13 out of the 20 companies on the Department of Defense's list have a presence in US capital markets, either by being directly listed or affiliated with a listed company. The former official, who is supportive of the country's restrictions against Chinese investors, had stated that immediate action had to be taken to remove companies affiliated with the People's Liberation Army from the country's financial systems.
In a statement, Rubio mentioned that the Chinese government's continued exploitation of the country's capital markets is a clear risk to its national security. He explained that his new bill should address the issue by finally cutting off the Chinese Communist Party's access to US capital markets.
Apart from having ties with the Chinese military, firms that support China's industrial policies will also be banned from US capital markets. The proposed bill by Rubio, who is the acting chairman of the Senate Select Committee on Intelligence, could further escalate tensions between China and the United States.
Earlier in the week, the US announced that it would be eliminating Hong Kong's special trade status due to the recent passing of the controversial national security law. Both countries are also still at odds over the origins of the coronavirus, with both sides pointing fingers at each other.
In recent months, the US has made several moves to block Chinese companies from getting access to US markets. This included the halting of the transfer of $40 billion worth of federal pensions into a fund that tracks the performance of several Chinese firms.
The move was followed by the tightening of application requirements for Chinese companies in various US exchanges. The decision was instigated after Chinese coffee chain operator Luckin Coffee had admitted that one of its employees had fabricated millions of dollars worth of sales on its financial reports.
