The national security law is a direct threat to foreign firms.
By Thomas Kellogg, Executive Director of Georgetown Law Asia, and Kaylee Morrison, a law student at Georgetown.
Since taking office in January, the Biden administration has taken a series of steps to signal a firm line on China, while at the same time making clear to Beijing that there is room to collaborate on key issues such as climate change and global health. On July 16, four key U.S. bureaucracies—the departments of State, Treasury, Commerce, and Homeland Security—issued an important advisory to American businesses in Hong Kong, warning them of the dangers posed by Hong Kong’s new national security law. In light of the new law, which was imposed last year, international businesses “should be aware of the potential reputational, economic, and legal risks of maintaining a presence or staff in Hong Kong,” the statement declared.
It’s rare to see four top U.S. government agencies speaking with one voice. The advisory is a product of both the growing friction between Beijing and Washington, and the very real and serious problems posed by the national security law. Past U.S. administrations, more cautious around the relationship, would likely have registered concerns over the law in a less high-profile way or would have refrained from public comment altogether. With the era of engagement now over, Washington is more open in its criticism of China’s human rights record, which explains both the recent advisory and other critical statements made on China by senior officials over the past few months.
But the national security law is also a genuine hazard for international businesses in Hong Kong. Its core criminal provisions are vague and overbroad, and they have been used to target peaceful political activists, lawyers, and mainstream politicians. The law also contains an extremely broad extraterritorial jurisdiction provision: Under Article 38 of the law, actions taken outside Hong Kong by non-Hong Kong citizens are covered. This means that businesses operating in Hong Kong—or even far from Hong Kong—can be dragged into cases involving prominent activists like Joshua Wong or Nathan Law, or more mainstream politicians like Martin Lee or Margaret Ng. All four have faced criminal charges or investigations, either under the national security law or other criminal provisions, over the past year.
Read the full article at https://foreignpolicy.com/2021/07/26/hong-kong-risky-international-business-national-security-law/
