SEC's Charges Against Chinese Affiliates Of U.S.-Based Accounting Firms Have Broad Implications

The recent initiation of an administrative action by the United States Securities and Exchange Commission (the “SEC”) against the Chinese affiliates of five major accounting firms significantly ups the stakes in the dispute between the SEC and its Chinese counterpart, the China Securities Regulatory Commission (the “CSRC”), over the SEC's ability to access materials related to China-based companies which are publicly listed in the U.S. While this dispute has been both long-running and increasingly public, it remains unclear how it might be resolved absent direct government-to-government negotiations.