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US threatens banks with sanctions over HK dealings

2020-10-15 HKT 02:26
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  • Banks that deal with Chief Executive Carrie Lam or nine other officials will face US sanctions. File image: Reuters
    Banks that deal with Chief Executive Carrie Lam or nine other officials will face US sanctions. File image: Reuters
The US State Department on Wednesday formally warned international financial institutions doing business with individuals deemed responsible for undermining Hong Kong's autonomy that they could soon face sanctions.

In a report to Congress, the State Department named 10 individuals, including Chief Executive Carrie Lam, all of whom have already been sanctioned, and said within 60 days it would identify financial institutions that conduct significant transactions with them.

Absent from the list is former police chief Stephen Lo, although no reason has been given for his removal.

It was the latest US response to China's actions in Hong Kong, including the enactment of a new national security law this year that Washington has called an unacceptable contravention of China's "one country, two systems" commitments toward the former British colony.

The State Department report, required under the Hong Kong Autonomy Act, comes at a time when relations between the United States and China, the world's two biggest economies, have plunged to the lowest point in decades in the run-up to US President Donald Trump's November 3 re-election bid.

In August, Washington imposed sanctions on Lam and other senior security and political officials for what Washington says is their role in curtailing political freedoms in a crackdown on the territory's pro-democracy movement.

Wednesday's State Department report did not add any new individuals to the list nor did it name any banks or other financial institutions that might be at risk for sanctions.

But the report put the firms on notice that they could be subject to so-called secondary sanctions, including restrictions on US loans, foreign exchange, property transactions, exports and transfers, in addition to measures against their executives.

Senior British and US politicians have recently criticised HSBC and Standard Chartered after the banks backed Beijing's National Security Law for the territory.

"The release of this report underscores our ongoing objection to Beijing’s actions that are intentionally designed to erode the freedoms of the people of Hong Kong and impose the CCP’s oppressive policies," State Department spokeswoman Morgan Ortagus said in a statement.

The US Hong Kong Autonomy Act that Trump signed into law on July 14, required the State Department to list those people it deemed responsible for China's failure to meet its obligations toward Hong Kong within 90 days and which makes them liable for sanctions.

It also requires a list of any financial institutions that knowingly conduct significant financial transactions with such persons 60 days after that.

It allows the US president to impose sanctions on individuals as soon as they are named and calls for sanctions on the financial institutions no later than a year after they are named. (Reuters)
Last updated: 2020-10-15 HKT 05:12