BEIJING, December 3 (TMTPOST)— Shares of Chinese firms listed in the United States suffered a widespread selloff after the U.S. financial regulator announced to adopt the new rule that poses risk of blocking Chinese firms from listing and one of China’s tech giants began to delist from the U.S. exchange.

Source: Visual China

American depositary Receipts (ADRs) of Alibaba, China’s most valuable company listed in U.S., tech plunged more than 8% to the lowest since April, 2017 on Friday. ADRs of another two e-commerce giants in China—JD.com and Pinduoduo fell over 8% and 7% respectively. ADRs of Didi Chuxing, China’s largest ride-hailing company, crashed over 22% lower and became one of the biggest losers. The Nasdaq Golden Dragon China index plunged about 9% that day, the biggest daily loss since 2008.

Earlier of these ADRs’ bloodbath, Didi said it started to delist its shares from the New York Stock Exchange (NYSE) and prepare for listing in Hong Kong, officially declaring a farewell after its app was removed from the native market stores as regulator launched cyber security review in early July. During the short lifespan of just five months, Didi’s ADRs had a decline about 57% since the debut, making the worst performance among Chinese firm that raised at least US$2 billion through an initial public offering (IPO) in New Work.    

The day before Didi’s abrupt announcement, the U.S. Securities and Exchange Commission (SEC) stated to implement final amendments of rules which implement the submission and disclosure requirements in the Holding Foreign Companies Accountable Act (HFCAA), a law that requires companies to certify not being owned or controlled by a foreign government entity and allows SEC to prohibit securities of any company from being listed or traded in U.S. if the company fails to comply with the Public Company Accounting Oversight Board (PCAOB)’s  audits for three consecutive years.

We are firmly opposed to the U.S. move, which is another step to hobble Chinese enterprises for political purposes and to suppress and contain China’s development, commented Zhao Lijian, the spokesperson of the Foreign Ministry on Friday. “Politicizing securities regulation will harm others and oneself,” Zhao warns. He added that Beijing will “take necessary measures to safeguard its legitimate and lawful rights and interests”.