On September 24, 2021, the Chinese Ministry of Foreign Affairs ("MFA") released the Fact Sheet: U.S. Interference in Hong Kong Affairs and Support for Anti-China, Destabilizing Forces ("Fact Sheet") which sets out a comprehensive list of events detailing the United States' interference in Hong Kong. The MFA spokesperson stated that the Fact Sheet is a "wake-up call" to external forces attempting to interfere into China's internal affairs and curb China's development.
What is included in the Fact Sheet?
The Fact Sheet lists the following five categories of activities that are considered as "interference" in Hong Kong:
(1) Enacting Hong Kong-related Acts, vilifying China's policy on Hong Kong, meddling in Hong Kong affairs, and wantonly interfering in China's internal affairs;
(2) Imposing sanctions in an attempt to obstruct the implementation in Hong Kong of the Hong Kong National Security Law and relevant decisions of China's National People's Congress;
(3) Making unfounded charges against HKSAR affairs and law enforcement actions taken by Hong Kong police in an attempt to undermine Hong Kong's prosperity and stability;
(4) Shielding and supporting those who are opposed to China and attempt to destabilize Hong Kong, providing platforms for them to advocate "Hong Kong independence" and spread political disinformation, and justifying the acts of those lawbreakers by twisting facts and misleading the public; and
(5) Colluding with some countries to exert pressure, and teaming up with allies to interfere in Hong Kong affairs and make irresponsible comments by such means as joint statements.
Would the entities or individuals mentioned in the Fact Sheet be sanctioned by China?
The MFA spokesperson labeled the Fact Sheet as a "criminal record" of United States interfering into China's affairs and undermining Hong Kong's prosperity and stability. However, the Fact Sheet is silent on what measures China might take to sanction or against relevant entities or individuals alleged to have engaged in activities interfering into Hong Kong affairs.
The Fact Sheet not only designates former U.S. officials such as Donald Trump, Mike Pompeo and Wilbur Ross, but also includes current officials such as Joe Biden, Antony Blinken and Nancy Pelosi. China did announced sanctions against former senior U.S. officials such as Mike Pompeo and Peter Navarro on January 21, 2021 (the day when the new Biden administration took office), including travel bans and prohibition from engaging in any transactions with them, their family members and affiliated companies.
According to China's Anti-Foreign Sanctions Law ("AFSL"), a sanction needs to be announced in the form of an "order." Given the Fact Sheet itself is not an "order," arguably no formal sanctions are imposed against the entities or individuals on the Fact Sheet. However, given China's AFSL authorizes China to: (1) take countermeasures against "discriminative restrictive measures" against China; and (2) sanction foreign countries, entities or individuals implementing or supporting activities that endanger China's sovereignty, national security or development interests, and the activities listed in the Fact Sheet are explicitly described as "interference" in China's internal affairs and endangering China's sovereignty, national security or development interests, there is a possibility that China may impose sanctions against these entities or individuals if it wants to do so.
What would be the implications for companies operating in China and Hong Kong?
As for companies operating in China and Hong Kong, the Fact Sheet would constitute a red flag when they are dealing with the entities or individuals on the Fact Sheet. Companies, including financial institutions, should conduct risks assessment before engaging in any transactions or providing any services to such entities or individuals. Otherwise, companies might be exposed to China's sanctions if any of their activities are considered as "implementing" or "supporting" the interfering activities described in the Fact Sheet.
