The New York Stock Exchange (NYSE) has decided to suspend trading in American depositary shares of China’s largest offshore oil producer CNOOC to comply with an executive order signed by former US President Donald Trump.
The decision will take effect on March 9, the US stock exchange said in a statement released after the closing bell on Friday. The NYSE said CNOOC, formally known as China National Offshore Oil Corporation, is “no longer suitable for listing” as it was one of the targets of Trump’s November order that banned investments into Chinese companies the US claims have ties with the Chinese military.
The delisting decision, which can be appealed by CNOOC, was enacted several months before the investment ban was set to officially come into force. Last month, the Biden administration pushed the deadline back from January to May 27.
The extension came as the new administration was reviewing actions that Trump had taken against China, such as trade policies and the inclusion of dozens of Chinese firms in two blacklists that were repeatedly expanded. In December, CNOOC ended up on the Pentagon’s blacklist, which prohibits investment into what it deems “communist Chinese military companies.” Just days before Biden’s inauguration in January, the oil group was also added to the infamous Entity List, which makes it harder for it to be supplied with exported US technology.
The delisting of the oil major follows a similar Wall Street move to ditch three major telecommunications corporations – China Mobile, China Telecom, and China Unicom (Hong Kong) – that had been present on the US market for nearly two decades. After the initial delisting announcement, the NYSE actually changed its mind at one point, but finally moved to enforce the plan to suspend trading in their shares.
Beijing has repeatedly warned Washington against hurting its businesses, saying that the delistings violate both market competition principles and international economic and trade rules. However, Chinese officials have stressed, while such removals from US stock markets may hurt American investors, they won’t cut off Chinese businesses from foreign capital inflows.
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