Alibaba has faced growth challenges amid tighter regulations in China’s tech sector and a slowdown in the world’s second-largest economy. But analysts believe the e-commerce giant’s growth could accelerate through 2022.
Kuang Da | Jemian News | CGV | Getty Images
Chinese e-commerce giant Alibaba said it would comply with US regulators and work to maintain its listings in New York and Hong Kong.
“Alibaba will continue to monitor market developments, comply with applicable laws and regulations, and strive to maintain its listed status on both the NYSE and the Hong Kong Stock Exchange,” he said. said in a statement to the Hong Kong Stock Exchange on Monday.
The statement came after Alibaba was added to the U.S. Securities and Exchange Commission’s list of Chinese companies at risk of delisting for failing to meet audit requirements on Friday. As a result, U.S.-listed Alibaba shares plunged 11% in Friday’s trading session.
On Monday, the stock was down more than 5% in Hong Kong, but recovered to trade around 2.2% by mid-afternoon.
Under the Foreign Company Liability Act, the SEC identifies public companies that have retained the services of a registered public accounting firm to issue an audit report when the firm has a branch or office.
On Monday, Alibaba said it had been added to the SEC’s list, saying its audits for the fiscal year ended March 31, 2022 could not be fully reviewed by the US Public Company Accounting Oversight Board.
Under the HFCAA, if the PCAOB cannot fully inspect the audits of a U.S.-listed company’s financial statements for three consecutive years of “no inspection,” the SEC is required to cease trading in the securities. of the company in the US markets.
Last week, the Chinese tech giant announced it would apply for a dual primary listing in Hong Kong. The tech giant’s shares are already traded on US and Hong Kong exchanges, but the current listing in Hong Kong is secondary.
The primary listing process in Hong Kong is expected to be completed before the end of 2022, the company said in a statement.
– CNBC’s Abigail Ng contributed to this report