Beijing is increasing the pressure: a law against sanctions from abroad is putting companies and banks in Hong Kong between the fronts. Is the free status of the economic metropolis in danger?
China’s leadership wants to enact laws to ward off foreign sanctions in Hong Kong and Macau.
The Standing Committee of the People’s Congress in Beijing discussed additions to the annexes to the basic laws of the two Chinese special administrative regions. A decision is expected on Friday, Hong Kong media reported.
The project is causing unrest among international companies and financial institutions who fear that they will get caught between the political fronts in the disputes between China and the USA and Europe. There is also concern that Hong Kong’s special status as a free Asian economic and financial metropolis could be jeopardized.
Experts see the law as a deterrent tool to prevent the USA or Europe from imposing further sanctions. Because of the repression of the democracy movement in Hong Kong and the dealings with the Muslim Uyghur minority in Xinjiang in northwest China, the US and the EU imposed various sanctions against those responsible in Hong Kong and China.
US sanctions imposed a year ago include the Hong Kong Prime Minister Carrie Lam, the director of the Beijing Liaison Office, Luo Huining, and several ministers and former police chiefs. In November the head of government complained that she had “stacks of cash” lying around at home because she could no longer have a bank account because of the sanctions.
In June the People’s Congress passed such a law against foreign sanctions for the People’s Republic. It prohibits companies and individuals from implementing sanctions against Chinese companies, and instead calls for cooperation with the Chinese resistance. Penalties such as account freezes, visa withdrawals, and deportation are threatened against businesses, managers, and family members. Affected companies can also sue foreign companies for damages.
It is still unclear how quickly the Hong Kong parliament, which is not freely elected, will adapt the law to local conditions. Since the text is kept very vague, in the end a lot also depends on the concrete implementation, as experts point out. But foreign companies and banks find themselves in a bind.
After the controversial security law, with which the authorities cracked down on critics in Hong Kong, and the electoral reform that excludes oppositionists viewed as unpatriotic, it is another bill that Beijing is using to expand its influence.
The US government warned multinational companies of new dangers in Hong Kong back in July. There was talk of “operational, financial, legal and reputational risks” from the Security Act and other legislative changes. China’s leadership and the loyal Hong Kong government “are undermining the legal and regulatory environment necessary for individuals and businesses to operate freely and with legal certainty in Hong Kong.”
Since it was returned to China in 1997, the former British crown colony is supposed to be administered autonomously and enjoy extensive rights of freedom. But after the metropolis had seen sustained demonstrations with calls for more democracy, Beijing tightened its grip on the Special Administrative Region.
Many critics are on trial or are already in custody. Others have left Hong Kong. Hong Kong’s population has shrunk by 90,000 in the twelve months since the Security Act was passed. Opposition groups and the teachers’ union have disbanded for fear of prosecution.
Whereas the principle of autonomy “one country, two systems” used to apply, today Hong Kong is increasingly being adapted to the communist people’s republic, so that critics only see “one system”.
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
