Hong Kong spy law is ‘threat to business’

Finance professionals can be arrested for espionage over information gathering under new draconian laws

WESTERN businesses in Hong Kong face growing uncertainty after politicians passed draconian new national security laws that will align the citystate even more closely with Beijing.

Hong Kong’s Legislative Assembly passed a major piece of legislation known as Article 23 yesterday, marking the latest stage of a widespread political crackdown that began in the wake of pro-democracy protests in 2019.

The laws, which will come into force on Saturday, introduce a series of new crimes including treason, sabotage, sedition, the theft of state secrets, external interference and espionage. The punishment for offences ranges from several years to life imprisonment.

Chris Patten, the last British governor of Hong Kong, branded the crackdown “another large nail in the coffin of human rights and the rule of law in Hong Kong”.

The measures, which further tighten the national security laws imposed on Hong Kong by Beijing in 2020, have fuelled concerns about the former British colony’s future as Asia’s business hub. Analysts pointed to the broad and vague wording of the new laws, which expand the definition of state secrets to cover information ranging from “diplomatic and foreign affairs activities” to the “economic or social development” of both Hong Kong and China.

This will spark fears that financial professionals gathering corporate information for work such as audits and analysis could be accused of espionage and be detained or even imprisoned.

Ho-fung Hung, professor of sociology at Johns Hopkins University, said: “With these draconian and not clearly defined clauses, even apolitical business persons will face the risk of being raided and themselves being detained, arrested or placed under exit ban as in many cases in mainland China.”

The new law comes amid a Beijing crackdown on purported spies that has already affected advisory and due diligence firms carrying out work in China.

Several large US consulting firms in the country were raided last year, while in January, Beijing accused MI6 of training a spy in a consulting agency.

Many multinational companies have already moved their Asian headquarters away from Hong Kong.

Under the laws, citizens could also be imprisoned for keeping old copies of

Apple Daily, the pro-democracy newspaper shut down in 2021. Founder Jimmy Lai is currently on trial.

Maya Wang, acting China director at Human Rights Watch, said: “The new security law will usher Hong Kong into a new era of authoritarianism.

“Now even possessing a book critical of the Chinese government can violate national security and mean years in prison in Hong Kong.”

The imposition of Article 23, which was rushed through Hong Kong’s Legislative Council fulfils a constitutional obligation for Hong Kong to enact its own security legislation.

David Cameron, the UK Foreign Secretary, said: “It will further damage the rights and freedoms enjoyed in the city.”