U.S. Department of State
Update to Report on Identification of Foreign Persons Involved in the Erosion of the Obligations of China Under the Joint Declaration or the Basic Law
REPORT
BUREAU OF EAST ASIAN AND PACIFIC AFFAIRS
DECEMBER 20, 2021
Pursuant to Section 5(a) of the Hong Kong Autonomy Act (“HKAA” or “Act”) (P. L. 116-149), not later than 90 days after the date of the enactment of the HKAA, if the Secretary of State, in consultation with the Secretary of the Treasury, determines that a foreign person is materially contributing to, has materially contributed to, or attempts to materially contribute to the failure of the People’s Republic of China (PRC) to meet its obligations under the Sino – British Joint Declaration (“Joint Declaration”) or Hong Kong’s Basic Law, the Secretary of State shall submit to the appropriate Congressional committees and leadership a report that includes (1) an identification of the foreign person; and (2) a clear explanation for why the foreign person was identified and a description of the activity that resulted in the identification. Pursuant to Section 5(e) of the Act, the report is to be updated in an on-going manner.
The Act sets out specific consequences for the foreign persons listed in this report. Pursuant to Section 6 of the Act, not later than one year from the date of this report, the President shall impose certain blocking sanctions on the listed persons and subject them to visa restrictions and exclusion from the United States. Furthermore, pursuant to Section 5(b) of the Act, not earlier than 30 days and not later than 60 days following the submission of this report, the Secretary of the Treasury, in consultation with the Secretary of State, shall submit a report to Congress that identifies any foreign financial institution (FFI) that knowingly conducts a significant transaction with the foreign persons listed in this report. Pursuant to Section 7(a) of the Act, within one year of their inclusion in the Secretary of the Treasury’s report, the Act mandates that the President impose not fewer than five out of 10 of the sanctions set out in Section 7(b) on any FFI identified pursuant to Section 5(b). These include (1) restrictions on loans from U.S. financial institutions; (2) prohibitions on designation as a primary dealer; (3) prohibitions on service as a repository of government funds; (4) restrictions on foreign exchange; (5) prohibitions on banking transactions; (6) prohibitions on property transactions; (7) restrictions on exports, re–exports, and transfers; (8) bans on investments in equity or debt; (9) exclusions of corporate officers; and (10) sanctions of principal executive officers. Not later than two years after an FFI has been included in the Secretary of the Treasury’s report, the President is required to impose all the sanctions set out in Section 7(b) of the Act.
The State Department has publicly condemned the erosion of rights and freedoms in Hong Kong, including those protected under the Joint Declaration and Basic Law. These developments include fundamental changes to the Hong Kong political system that reduce the proportion of directly elected seats in the Legislative Council and introduce a strict, multi-tiered vetting system that gives Beijing effective veto power, without judicial oversight, over opposition candidates’ ability to run for office. The PRC has disqualified sitting moderate and pro-democracy lawmakers and delayed legislative elections. In January 2021, Hong Kong authorities arrested 55 opposition politicians for participating in or organizing primary elections the previous summer. Hong Kong authorities have placed pressure on the judiciary. Judges appointed to oversee national security cases have denied bail and jury trials.
The PRC has undermined press and academic freedom to silence critics. Hong Kong police have arrested and prosecuted journalists in connection with their duties as reporters. In June 2021, Hong Kong authorities forced the closure of newspaper Apple Daily, a bastion of independent journalism, and arrested members of its staff. The public broadcaster, Radio Television Hong Kong (RTHK), required staff to pledge a loyalty oath to the PRC, and refused to air reporting on politically sensitive topics. Schools now integrate “national security education” into all aspects of their curriculum, limiting free speech in education, suppressing the academic freedom of teachers, and prompting some educators to resign. Hong Kong authorities instituted oath-taking requirements for civil servants, prompting more than 100 to refuse and resulting in their suspension.
Authorities have arrested or detained thousands of Hong Kong residents for speaking out against their government’s policies. Authorities have also detained individuals for the publication of books and articles that conflict with the priorities of the Hong Kong government, including children’s books. In addition, Hong Kong authorities put pressure on civil society organizations, denying residents permission to organize vigils to commemorate the 1989 Tiananmen Square massacre, arrested people for social media posts related to their individual efforts to commemorate the massacre, and accused the leaders of Hong Kong’s June 4 Museum of operating an illegal establishment, leading to its closure.
The actions described above demonstrate that the PRC continues to undermine Hong Kong’s high degree of autonomy and that foreign persons have materially contributed to the failure of the PRC to meet its obligations under the Joint Declaration and Basic Law, as defined in Section 5(g) of the Act.
Foreign Persons Materially Contributing to the Failure of the PRC to Meet Its Obligations Under the Joint Declaration and Basic Law
On October 14, 2020, the Secretary of State submitted a report to Congress pursuant to section 5(a) of the HKAA, which listed 10 foreign persons that the Secretary of State, in consultation with the Secretary of the Treasury, determined are materially contributing to, have materially contributed to, or attempted to materially contribute to the failure of the PRC to meet its obligations under the Joint Declaration or the Basic Law, as this is defined by section 5(g) of the HKAA. On March 16, 2021, the Department of State submitted a report listing an additional 24 foreign persons determined to meet the HKAA criteria. This report is an update to the October 2020 and March 2021 reports, consistent with section 5(e) of the HKAA.
Pursuant to section 5(a) of the HKAA, the Secretary of State, in consultation with the Secretary of the Treasury, has determined the five foreign persons listed below are materially contributing to, have materially contributed to, or attempt to materially contribute to the failure of the PRC to meet its obligations under the Joint Declaration or the Basic Law, as defined in section 5(g) of the HKAA. As also required under section 5(a), the list below includes (1) an identification of the foreign person; and (2) a clear explanation for why the foreign person was identified and a description of the activity that resulted in the identification. The Secretary of State previously designated the individuals listed in this report as subject to blocking sanctions under Executive Order (E.O.) 13936 on July 16, 2021, and the Department of the Treasury added them to its List of Specially Designated Nationals and Blocked Persons. Individuals designated under E.O. 13936 are also subject to visa restrictions under section 7 of that order.
Chen Dong is a Deputy Director of the Liaison Office of the Central People’s Government in Hong Kong (LOCPG), which is the PRC’s main platform for projecting its influence in Hong Kong. The LOCPG has repeatedly undermined the high degree of autonomy promised for Hong Kong in the Joint Declaration, including issuing statements asserting its authority to supervise Hong Kong’s internal affairs in contradiction to the Basic Law and the Joint Declaration.
Lu Xinning is a Deputy Director of LOCPG, which is the PRC’s main platform for projecting its influence in Hong Kong. The LOCPG has repeatedly undermined the high degree of autonomy promised for Hong Kong in the Joint Declaration, including issuing statements asserting its authority to supervise Hong Kong’s internal affairs in contradiction to the Basic Law and the Joint Declaration.
Tan Tieniu is a Deputy Director LOCPG, which is the PRC’s main platform for projecting its influence in Hong Kong. The LOCPG has repeatedly undermined the high degree of autonomy promised for Hong Kong in the Joint Declaration, including issuing statements asserting its authority to supervise Hong Kong’s internal affairs in contradiction to the Basic Law and the Joint Declaration.
He Jing is a Deputy Director of LOCPG, which is the PRC’s main platform for projecting its influence in Hong Kong. The LOCPG has repeatedly undermined the high degree of autonomy promised for Hong Kong in the Joint Declaration, including issuing statements asserting its authority to supervise Hong Kong’s internal affairs in contradiction to the Basic Law and the Joint Declaration.
Yin Zonghua is a Deputy Director of LOCPG, which is the PRC’s main platform for projecting its influence in Hong Kong. The LOCPG has repeatedly undermined the high degree of autonomy promised for Hong Kong in the Joint Declaration, including issuing statements asserting its authority to supervise Hong Kong’s internal affairs in contradiction to the Basic Law and the Joint Declaration.
