The law went on the books in 2002 after a string of corporate scandals, including the Enron Corp meltdown. The measure's sweeping reforms require CEOs and chief financial officers to certify in sworn written statements the accuracy of the company's financial results -- with possible prison terms for signing statements they knew to be false.
"For these Chinese enterprises, it takes time to catch up with the latest developments in corporate governance practices," Cheung, said. "If they had to comply with the Sarbanes-Oxley act, I don't know how long it would take them."
Thirty-eight Chinese companies now trade on US stock exchanges, as do 19 companies with headquarters in Hong Kong, according to Associated Press data.
New York Stock Exchange (NYSE) chairman Marshall Carter testified before a congressional committee on April 26 that tougher regulations have hurt the exchange's pursuit of foreign IPOs.
Almost half of non-US companies going public did so on the NYSE or NASDAQ in 2000, but that number plunged to 5.7 percent last year because of "US regulatory rules and oversight," he said.
But the US won't relax its regulatory standards just to recapture any IPO business heading to foreign markets, Christopher Cox, chairman of the Securities and Exchange Commission, said April 25 in testimony to a Senate committee. He warned of "a race to the bottom" if the US were to do so.
Hong Kong ranked No. 5 in the world last year in share issuance, raising HK$292.5 billion (US$37 billion), after the New York Stock Exchange, Euronext (the Paris, Amsterdam, Brussels and Lisbon exchanges), the London Stock Exchange and Toronto's TSX Group, said the exchange, citing the World Federation of Exchanges.
Ma said those who only focus on governance and transparency issues don't understand the numerous other factors that make Hong Kong appealing to Chinese companies -- including the fact that professional and underwriting fees in the US are double the cost in Hong Kong.
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