SEC rejects sale of Chicago Stock Exchange

SEC Blocks Chinese Takeover of Chicago Stock Exchange

Manchin spearheaded a letter to the SEC's chairman Jay Clayton and commissioners Kara M. Stein and Michael S. Piwowar, in which the West Virginia Democrat up for re-election this year called for them to reject the proposed sale of the Chicago Stock Exchange to Chongqing Casin Enterprise Group (CCEG), a group that includes US and Chinese investors.

Trump brought the exchange deal up twice during the election campaign as an example of how jobs and wealth were leaving the US.

In August of past year, SEC staff reportedly recommended that the deal be approved, but amid stiff opposition from United States lawmakers then announced its commissioners would review the sale.

The Securities and Exchanges Commission rejected the sale of the Chicago Stock Exchange to a group that includes Chinese investors, the Wall Street Journal reported late Thursday.

Casin has continued to deny any affiliation with the government of China and there have been no connections shown.

The decision by the SEC comes during a time of increased trade tensions between the USA and China.

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Last summer, 11 members of Congress sent a letter to the SEC urging a denial of the purchase - with particular concerns about a "severe lack of transparency in China", which they said would make it hard for the committee to "prevent undue influence or control over a national securities exchange". It also planned to eventually build an exchange in China using Chicago Stock Exchange technology. Deutsche Boerse bought the US-based International Securities Exchange for $2.8bn in 2007, before selling it to Nasdaq for $1.1bn in 2016. In an order made public on Thursday, the commission said it was "not necessary" to consider those concerns, because the structure of the deal itself was problematic enough on its own.

In a letter sent to the SEC chairman over the summer, 11 members of Congress said they had concerns about the "severe lack of transparency in China", which would make it hard for the committee for "prevent undue influence or control over a national securities exchange".

In particular, the SEC said it was not satisfied that it would have full access to the exchange's books and records if the deal were to go through.

The Chinese investors at the heart of the deal have been trying to get the sale approved for the past two years. The exchange said it needed the infusion of capital to invest in its operations and attract business.

A spokesman for the Chicago Stock Exchange declined to comment.

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