US Senate Passes New Regulations For Chinese Companies; Alibaba, Others Trade Down

The U.S. Senate approved a bill Wednesday that lead to the delisting of Chinese companies from U.S. stock exchanges.

The China Legislation

Senator John Kennedy submitted the Holding Foreign Companies Accountable Act for unanimous consent and the bill was approved without objection, reported MarketWatch.

The bill requires Chinese companies to establish that they are not owned or controlled by a foreign government.

Why It's Important For Chinese Companies

The new legislation could deter Chinese companies from listing shares on U.S. exchanges and raising money from U.S. investors. Several China-based stocks fell on the news.

Alibaba Group Holding BABA shares were trading down 1.4% at $214.55 on Wednesday. The stock has a 52-week high of $231.14 and a 52-week low of $147.95.

Baidu BIDU shares were trading down 1.4% at $108.21. The stock has a 52-week high of $147.38 and a 52-week low of $82.

JD.Com Inc JD shares were trading down 0.55% at $53.96. The stock has a 52-week high of $56.50 and a 52-week low of $25.48.