National security law: Hong Kong’s financial institutions gripped by anxiety over United States sanctions

National security law: Hong Kong’s financial institutions gripped by anxiety over United States sanctions

  • Bank insiders say they are walking a tightrope between following US requirements and ensuring they comply with Hong Kong laws
  • US sanctioning of Carrie Lam and 10 other officials for their role in the national security law heaps fresh uncertainty on Hong Kong’s finance sector

Hong Kong’s financial institutions, from banks and fund managers to brokerages and insurance companies, have been gripped by anxiety and uncertainty since the United States slapped sanctions on key local and mainland Chinese officials over the imposition of the city’s national security law.Bank insiders told the Post on Sunday that they were caught between a rock and a hard place, having to tread an unclear line on US requirements to avoid doing business with the 11 officials named in the sanctions list while also ensuring they did not run foul of local law by complying.

They expressed surprise over the Hong Kong Monetary Authority’s (HKMA) assurance that unilateral sanctions had no legal status in the city, and that they were not obliged to comply, despite the risk of retaliation by the US.Some also warned that the sanctions, on top of other punitive measures by Washington such as its crackdown on Chinese-owned video service provider TikTok, would temporarily rock Hong Kong’s financial market.