US Warns Companies About ‘New and Heightened Risks’ of Doing Business in Hong Kong

The United States has warned American businesses, academic institutions, and media about “new and heightened risks” in Hong Kong, saying they could be targeted for their regular operations in the Asian financial hub.
Under the new legislation, which went into effect in late March, offenses such as treason, insurrection, and sabotage now carry a maximum penalty of life imprisonment.
The U.S. advisory states that the new ordinance contains “broad and vague provisions” taking aim at activities such as “colluding with external forces” and engaging in acts related to “state secrets” and “espionage.”
These activities encompass a wide range of actions, such as researching government policies; analyzing China’s economic landscape; maintaining contact with officials, journalists, and nongovernmental organizations; and managing data within Hong Kong, according to the advisory.
Businesses operating in Hong Kong could be exposed to “privacy-related risks, including electronic surveillance without warrants and the surrender of data to authorities,” it notes.
The advisory states that the expanded legal power allows Beijing and Hong Kong officials to obtain data from businesses and individuals in the city for activities that they perceive to violate “national security” or involve “theft” of a “state secret.”
The advisory notes that Hong Kong authorities had already imposed arrest bounties on overseas-based pro-democracy activists even before the law was enacted.
In December 2023, Hong Kong police offered rewards of HK$1 million (about $128,000) for any information leading to the capture of five activists. They have already moved to other countries, including the United States and the UK.
Secretary of State Antony Blinken condemned this action, saying it reflects Hong Kong authorities’ “disregard for international norms and human rights in Hong Kong and the deterioration of that city’s once proud tradition of respecting the rule of law.”
More than 200 people have been arrested on allegations of violating the existing security law since its enactment in 2020, with about half subsequently convicted, according to the advisory.
The advisory states that the Hong Kong government’s implementation of the national security law has resulted in “major structural changes that significantly reduced Hong Kong’s autonomy and undermined human rights and fundamental freedoms.”
In response, the Hong Kong government called the U.S. business advisory “misleading.”
The State Department updated its travel advisory for Hong Kong following the enactment of Article 23, urging Americans to “exercise increased caution” because of the “arbitrary enforcement of local laws.”