Manchin Sends Letter to President Trump Condemning Sale of Chicago Stock Exchange to Chinese Firm
Washington, D.C. – U.S. Senator Joe Manchin (D-WV) today sent a letter to President Trump urging the President to prevent the sale of the Chicago Stock Exchange (CHX) to investors led by the Chinese firm Congqing Casin Exterprise Group (CCEG). In the letter, Sen. Manchin notes the threat to America’s financial markets the sale of CHX to CCEG presents.
“The Chinese government categorically rejects the bedrock free-market principles upon which the American economy—and especially the American financial sector—are based,” Senator Manchin said. “I fear that that the challenges plaguing the Chinese market—lack of transparency, currency manipulation, etc.—will bleed into the Chicago Stock Exchange and adversely impact financial markets across the country.”
To ensure the Trump administration fully reviews the sale of CHX, Senator Manchin plans to introduce legislation to amend the Foreign Investment and National Security Act of 2017 (FINSA). The legislation will work to allow the Executive Branch to review decisions regarding acquisitions of American companies made by a previous administration.
“When the American people elect a new chief executive, the chief executive should not be hamstrung by his predecessor’s decision to abdicate his authority on critical matters of national security,” Senator Manchin said. “FINSA gives the President sweeping powers to block any proposed acquisition of American companies and assets that may threaten national security, but these powers mean little if they can be nullified by a lame duck administration on its way out the door.”
Please read the full letter below, or click here:
Dear Mr. President:
During your campaign, you forcefully made the case for protecting our nation against unfair trade and investment deals put in place by the Chinese government and its corporate leaders, many of whom have close ties to the ruling regime. I commend you for using your authority as this nation’s chief executive to continue focusing a spotlight on the way that China’s exploitative trade practices and the flood of Chinese investment capital threaten the security and prosperity of the American people.
In December 2016—just one month before you entered office—the Committee on Foreign Investment in the United States (CFIUS), a group of political appointees of former President Obama, green-lighted the approval of the Chicago Stock Exchange by a group of investors led by the Chinese firm Congqing Casin Enterprise Group (CCEG). Discounting the threat that this proposed acquisition presented to the United States’ financial security and Americans’ faith in our national financial market infrastructure, President Obama chose not to exercise his statutory authority to override CFIUS’ recommendation and block the sale during the 15-day review period mandated by the Foreign Investment and National Security Act of 2017 (FINSA).
This is deeply unfortunate. Since a transfer of ownership of a national stock exchange requires that the Securities and Exchange Commission approve a proposed rule change under the Securities Exchange Act of 1934—and the members of the Commission have not yet made their determination of whether to approve the rule—the acquisition is still pending. Yet CFIUS’ decision to issue a recommendation in the twilight of your predecessor’s administration effectively insulated the deal from your review. This is a travesty.
In the coming weeks, I plan to introduce legislation that will amend FINSA to preserve a new administration’s right of review. When the American people elect a new chief executive, the chief executive should not be hamstrung by his predecessor’s decision to abdicate his authority on critical matters of national security. FINSA gives the President sweeping powers to block any proposed acquisition of American companies and assets that may threaten national security, but these powers mean little if they can be nullified by a lame duck administration on its way out the door. In order to allow time for this legislation to proceed through Congress, I would ask that you instruct the Chairman and Commissioners of the Securities and Exchange Commission to withhold their determination on the proposed rule change until this legislation can reach your desk.
I believe you would agree that your predecessor’s decision to allow a group of Chinese investors with possible ties to the Chinese government to own one of our largest stock exchanges is nothing short of outrageous. Our government considers our stock exchanges—a key part of our national financial market infrastructure—to be “self-regulatory organizations,” and presumes that each exchange is fully capable of managing the risk inherent in its operations. The Chinese government’s continued rejection of fundamental free-market norms and property rights of private citizens makes me strongly doubt whether an Exchange operating under the direct control of a Chinese entity can be trusted to “self-regulate” now and in the future.
The Chinese government categorically rejects the bedrock free-market principles upon which the American economy—and especially the American financial sector—are based. I fear that that the challenges plaguing the Chinese market—lack of transparency, currency manipulation, etc.—will bleed into the Chicago Stock Exchange and adversely impact financial markets across the country. As we continue to employ the greatest lengths of diplomacy to shore up our relationship with China, we must not forget their desire to emerge on top of the international market as the sole global power. Their sustained efforts to steal intellectual property and state-sponsored cyber-attacks present clear and present threats to our national security, and I believe it is highly likely that they will employ similar, deceitful practices to gain an unfair advantage in our financial markets through this acquisition.
Thank you for your attention to this matter.
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