Hong Kong may now be used by Russia, North Korea, and the Chinese regime to evade international sanctions against the Russian war, lawmakers said.
The House Select Committee on the Chinese Communist Party (CCP) has asked the U.S. Treasury Department to reexamine the U.S. relationship with Hong Kong, given the CCP’s stronger hold on the city through the implementation of a 2020 update to the Hong Kong National Security Law.
Led by Rep. John Moolenaar (R-Mich.), committee chair, and Rep. Raja Krishnamoorthi (D-Ill.), ranking member, the lawmakers requested a briefing, pointing to evidence that Hong Kong may now be used by Russia, North Korea, and the Chinese regime to evade international sanctions and reroute financing for the Russian war.
“Hong Kong has shifted from a trusted global financial center to a critical player in the deepening authoritarian axis of the People’s Republic of China (PRC), Iran, Russia, and North Korea,” the lawmakers wrote in a letter published on Nov. 25. “We must now question whether longstanding U.S. policy toward Hong Kong, particularly toward its financial and banking sector, is appropriate.”
The letter was published on the same day that Hong Kong held a major business summit that included international business leaders as speakers and attendees.
Hong Kong was given preferential treatment in the 1990s because it was understood to operate separately from mainland China, but this has changed, according to the lawmakers. They pointed to condemnations of the CCP-directed Hong Kong policies by both current and former State Department leaders as further indication that the executive branch believes Hong Kong to be under the CCP’s control.
The lawmakers also pointed out that Hong Kong entities have already been sanctioned for aiding Russian war efforts.
“The city has now become a global leader in practices such as importing and re-exporting banned Western technology to Russia, creating front companies for purchasing barred Iranian oil, facilitating the trade of Russian-sourced gold, and managing ‘ghost ships’ that engage in illegal trade with North Korea,” the letter reads.
The letter also follows a recommendation from the U.S.–China Economic and Security Review Commission to Congress last week to direct the Treasury to designate Hong Kong as a Primary Money Laundering Concern (PMLC) jurisdiction under the Patriot Act. Such a designation would allow the Treasury Department to require financial institutions to take specific actions.
Hong Kong representatives did not respond by publication time to an inquiry from The Epoch Times.
The Hong Kong government recently issued a statement strongly criticizing the commission’s annual report to Congress.
The annual review, published on Nov. 19, states that “Hong Kong has become a key transshipment node in a global network that assists Russia and other adversaries in evading sanctions and circumventing export controls.”
The commission advised Congress that Hong Kong’s role in global trade undermines international sanctions and national security efforts and also “exposes Western investors, financial institutions, and firms to financial and reputational risks when they do business in Hong Kong.”
In addition to the PMLC designation, it recommended that Congress examine the relationship between authorities in Hong Kong and the United States in enforcing export controls and sanctions.
Chief among the concerns is Hong Kong’s updated National Security Law and companion legislation that criminalizes various forms of political assembly. Experts say the law’s broad and vague language, which puts treason and cooperation with international political organizations on the same footing, effectively puts Hong Kong under the direct control of the Chinese communist regime. The commission warned that the regime applies these laws extraterritorially, and the erosion of freedoms in Hong Kong puts the safety of those who conduct business with it at risk.
Just last week, Hong Kong courts sentenced 45 pro-democracy activists to as high as 10 years in prison under the updated National Security Law.
Moolenaar condemned the sentences and the continuation of the trial of Jimmy Lai, a newspaper publisher and one of the most high-profile pro-democracy arrestees under the law.
“This week saw Hong Kong authorities, acting at the behest of the CCP, impose harsh and unjust prison sentences against courageous pro-democracy Hong Kongers,” he said. “It is clear that Hong Kong’s legal system has been degraded and is controlled by the CCP.”