Here’s why the EV maker LI Auto was named by SEC to the HFCAA list

Written by Cláudio Afonso |

On Thursday, Chinese electric vehicle maker LI Auto was named by the United States Securities and Exchange Commission (SEC) to Holding Foreign Companies Accountable Act (the “HFCAA”) list. According to the company, the SEC said that LI Auto used a registered public accounting firm whose working paper cannot be inspected or investigated completely. The EV maker says that “has been actively exploring possible solutions to protect the interest of its stakeholders.”

SEC requires that all the accounting firms used have to be inspected by the Public Company Accounting Oversight Board of the United States (PCAOB). In this case refers to LI Auto’s financial statements for the fiscal year ended December 31, 2021.

“In accordance with the HFCAA, the SEC shall prohibit a company’s shares or American depositary shares (“ADSs”) from being traded on a national stock exchange or in the over-the-counter trading market in the United States if the company has been identified by the SEC for three consecutive years due to PCAOB’s inability to inspect the auditor’s working paper.” — LI said.

“The Company has been actively exploring possible solutions to protect the interest of its stakeholders. The Company maintains a dual-primary listing on The Main Board of The Stock Exchange of Hong Kong Limited under the stock code “2015.” Its Class A ordinary shares and ADSs remain mutually fungible. The Company will continue to comply with applicable laws and regulations in both China and the United States.” — LI concluded.

Earlier this month, Li Auto announced that delivered 11,034 Li ONEs in March 2022, up 125.2% year over year. This took the Company’s first quarter deliveries to 31,716, representing a 152.1% year-over-year increase. The cumulative deliveries of Li ONE reached 155,804 since the vehicle’s market debut in 2019.

On March 14th, LI Auto announced that the Company’s Class A ordinary shares, which are listed and traded on the Stock Exchange of Hong Kong Limited, have been included in the Shenzhen-Hong Kong Stock Connect program, effective on March 14, 2022, based on the announcement of the Shenzhen Stock Exchange.

As of March 31, 2022, the Company had 217 retail stores in 102 cities, as well as 287 servicing centers and Li Auto-authorized body and paint shops operating in 211 cities.

Written by Cláudio Afonso |