Chinese stocks are down sharply this afternoon. China stocks became proxies for the trade war with China a few years back, now the SEC is ramping up the pressure. The SEC identified five U.S. listed American depositary receipts of Chinese companies for failing to adhere to the Holdings Foreign Companies Accountable Act (HFCAA). The act, passed in 2020, gives SEC the authority to ban companies from trading and being delisted from U.S. exchanges if American regulators cannot audit company’s statements for three consecutive years. The five companies on the loop are Yum China, BeiGene, ZaiLab, ACM Research and HUTCHMED.