The head of the US Securities and Exchange Commission (SEC) Gensler decided to make it difficult for Chinese companies to link to IPO in the US. He was afraid of China’s reprisals against its own companies, because of which Chinese stocks plummet immediately after being placed on American exchanges, and foreign investors risk losing money.

The commission focused on the structural features of Chinese companies. The suspicion is that cash flows are channeled through so-called variable-interest entities, allowing businesses to bypass China’s restrictions on foreign investment. According to sources, whose names Bloomberg does not call, the SEC requires the Chinese to provide information on the mechanism of movement of money transfers and dividend payments between the main company and its legal entities, as well as on the tax consequences of entering US exchanges.