A proposal to add Chinese fintech giant Ant Group to a trade blacklist has been delivered to the Trump administration, adding even more headwinds to its upcoming dual listing in Hong Kong and Shanghai.
The U.S. State Department has submitted the proposal, according to a «Reuters» report citing unnamed sources, to add Ant Group to a trade blacklist just weeks before its planned IPO.
Trump officials claim the move could deter U.S. investors from fraud risk or privacy risk due to banking data access by the Chinese government.
The decision on whether or not to add companies to the list lies with the «End User Review Committee» which is made up of the U.S. departments of State, Defence, Energy and Commerce.
More Hurdles
Days after calls to blacklist Ant by the likes of Republican senator Marco Rubio who said it was «outrageous that Wall Street is rewarding the Chinese Communist Party’s blatant crackdown on Hong Kong’s freedom and autonomy,» Chinese regulators also added headwinds over claims of conflict of interest with its payment arm Alipay.
Alipay was the only third party channel which allowed access to the five Chinese mutual funds investing in Ant's IPO. Without using traditional channels like banks and brokers, it managed to lure over 10 million retail investors, according to «Reuters» sources.
The Hong Kong leg of the listing is being sponsored by China International Capital Corp, Citigroup, J.P. Morgan and Morgan Stanley, with Credit Suisse working as a joint global coordinator. Goldman Sachs is also involved in the deal.
