(Yicai Global) March 11 -- All but one of the five US-listed Chinese firms named by the US securities regulator for possible delisting if they fail to submit comprehensive audit documents have issued responses to the warning.

Yum China Holdings, which owns KFC and Pizza Hut in China, said it will be booted from the New York Stock Exchange in 2024 unless an amendment to the Holding Foreign Companies Accountable Act excludes the company, or the Public Company Accounting Oversight Board can fully review its audits within a certain time.

The US Securities and Exchange Commission finalized a provisional list on March 8, requiring Yum China, biotech firms BeiGene and Zai Lab, chip-manufacturing gear maker ACM Research, and drugmaker HutchMed China to submit evidence by March 29 as to why they should not be delisted under the HFCAA.

The HFCAA, which took effect in December 2020, empowers the SEC to remove companies that have not allowed the PCAOB to review their detailed financial audits for three years since 2021.

BeiGene said it has been actively seeking solutions to meet the requirements of the HFCAA.

ACM Research Shanghai said its controlling shareholder, ACM Research, is committed to meeting the SEC’s requirements by the 2024 deadline. ACM Research Shanghai’s share stability, production and operations have not been impacted, it added.

Zai Lab said it expected more companies to appear on the SEC’s provisional list as they report their annual earnings. But Zai Lab’s provisional designation does not mean that it will be delisted from the NYSE, it said.

Following the SEC’s move, China’s securities watchdog said it is strongly opposed to the politicization of securities regulation and is willing to resolve the issue of checks on listed Chinese companies by US authorities through regulatory cooperation, which is in line with international practice.

A number of analysts said the HFCAA mainly targets US-listed Chinese firms even though it also applies to companies from other countries.

US-listed Chinese stocks were routed yesterday after the SEC published the names of the firms in the first group for possible delisting. Among the five identified, ACM Research [NASDAQ: ACMR] dropped the most, plunging 22 percent.

In China today, shares of BeiGene [SHA: 688235], Yum China [HKG: 9987], Zai Lab [HKG: 9688] and ACM Research [SHA: 688082] closed down 4.1 percent, 6 percent, 6.3 percent and 5.4 percent, respectively.

Editor: Peter Thomas