The U.S. and Chinese flags are seen at a trade port in Qingdao in China’s eastern Shandong province.

AFP/Getty Images

The Democratic-run House of Representatives on Wednesday passed a bill that could bar many Chinese companies from listing shares on U.S. exchanges or otherwise raising money from American investors.

The measure, known as the Holding Foreign Companies Accountable Act, could get signed into law quickly by President Donald Trump, as it was approved by the Republican-controlled Senate in May.

The bill aims to make foreign companies let the Public Company Accounting Oversight Board oversee the auditing of their financial records if they want to raise money by selling stocks or bonds to the U.S. public. All U.S. companies and most foreign companies already work with the PCAOB in this way, but Chinese ones

do not.

Opinion: The ‘Holding Foreign Companies Accountable Act’ has all the nuance of a sledgehammer

Also see: ‘It’s time for China to blink first,’ says Rep. Sherman, who leads the drive to delist China stocks

Investors shouldn’t necessarily be spooked right now by the Holding Foreign Companies Accountable Act, according to some analysts.

The measure is “viewed as an ‘appropriate policy response’ and something the Public Company Accounting Oversight Board has sought for several years now on well-substantiated policy grounds,” said Henrietta Treyz, director of economic policy at Veda Partners, in a note on Wednesday ahead of the House’s vote.

“It is the expectation amongst lawmakers and trade policy watchers that the move will not be considered problematically escalatory and is not likely to trigger a robust or problematic response from China in retaliation for passage of this bill,” she added. “The expectation there is that President Xi will abstain from making any further moves where the U.S. is concerned (or at least material moves) until President-elect Joe Biden is sworn into office.”

Wednesday’s House approval happened by voice vote and under “suspension of rules,” a common procedure that helps the chamber move more quickly.

Action on the Holding Foreign Companies Accountable Act comes as Biden has revealed that he plans to keep import tariffs on China in place early in his presidency. It also comes after Trump signed an executive order earlier this month prohibiting Americans from investing in a clutch of Chinese companies that his administration says support Beijing’s military.

U.S. stocks

closed mostly higher on Wednesday, as the S&P 500

notched a fresh record.

Now read: Bears book nearly $400 million from legislation aimed at stopping China from ‘cheating’

MarketWatch’s Chris Matthews contributed to this report.

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