State Dept. Again Certifies Hong Kong Doesn't Warrant Special Treatment

The State Department on March 31 issued its annual report to Congress certifying that Hong Kong doesn’t warrant differential treatment from mainland China under U.S. law. The report follows a determination last year by the Trump administration that Beijing’s so-called national security law was infringing upon Hong Kong’s autonomy, which led to a series of U.S.-imposed trade restrictions, sanctions and export controls (see 2005270026, 2012220053 and 2103170027). Secretary of State Antony Blinken said the U.S. will continue to work with Congress and allies “to stand with people in Hong Kong against [China’s] egregious policies and actions.”

The report outlines measures taken by China to restrict democracy efforts in Hong Kong and details various changes to U.S. export control laws, sanctions and international sanctions over the last year. The State Department said the U.S. imposed sanctions on 35 Chinese and Hong Kong officials during the reporting period, adding that the Hong Kong government hasn’t taken action to penalize entities that violate United Nations sanctions against North Korea. But the agency said Hong Kong “de-registered a number of companies” suspected of “facilitating” North Korean-related activity.

The State Department also highlighted the Commerce Department's efforts to suspend special licensing treatment for exports to Hong Kong. Because Hong Kong is a “major port city,” there is a high risk of “illegal transshipment of U.S. controlled items through Hong Kong,” the agency said. But it added that Commerce’s Bureau of Industry and Security has worked with Hong Kong “counterparts” to reduce “the risks of diversion.”