The United States Department of State on Wednesday formally warned international financial institutions doing business with individuals deemed responsible for China’s crackdown in Hong Kong that they could soon face sanctions. In a report to Congress seen by Reuters, the State Department named 10 individuals all of whom have already been sanctioned, including Hong Kong’s Chief Executive Carrie Lam and said within 60 days it would identify financial institutions that conduct significant transactions with them. 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 US 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.
The US Hong Kong Autonomy Act that Trump signed into law on July 14 required the State Department to list those people deemed responsible for communist-ruled China’s failure to meet its obligations towards Hong Kong within 90 days, 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.
Senior US and United Kingdom politicians have criticized HSBC and Standard Chartered after the banks backed China’s national security law for the territory.