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1. Introduction

A number of bills and resolutions have been introduced in the U.S. Congress that relate to the formal relationship between the United States and Hong Kong. The bill that potentially has the broadest impact is the Hong Kong Human Rights and Democracy Act of 2019 (the "HK Human Rights Act"), which is intended to amend the United States-Hong Kong Policy Act of 1992 (the "Hong Kong Policy Act"). 

It is important to note that although the HK Human Rights Act has been passed by the U.S. House of Representatives (on 15 October 2019), it has not yet become law and will not become law until passed by the Senate and presented to the President. The President could veto the legislation, but such action would be subject to a potential override by Congress.  

2. The Key Terms of the HK Human Rights Act

The HK Human Rights Act, should it become law, will increase U.S. monitoring over Hong Kong, including the way in which Hong Kong is administered and how the government handles certain United States interests in Hong Kong. 

The remainder of this Alert discusses specific provisions of the HK Human Rights Act. 

(a) Annual Report by the Secretary of State

Under the Hong Kong Policy Act the U.S. Secretary of State must submit a report every year to certain congressional committees (commonly referred to as the "Hong Kong Policy Act Report") on conditions in Hong Kong. The annual report focuses on, inter alia, developments in United States relations with Hong Kong, any other matters affecting United States interests in Hong Kong or United States relations with Hong Kong, significant problems in cooperation in the area of export controls, and the development of democratic institutions in Hong Kong.

The HK Human Rights Act would add additional reporting requirements to the Hong Kong Policy Act by requiring the annual report to include matters relating to: 

  1. China's ability to limit Hong Kong's autonomy;
  2. The limitations to Hong Kong's autonomy; and
  3. The impact to any areas of cooperation between the United States and Hong Kong as a result of limits to Hong Kong's autonomy.

(b) Annual Certification by the Secretary of State

In addition to the annual report referred to in 2(a) above, the Hong Kong Policy Act (as amended by the HK Human Rights Act) will oblige the Secretary of State to submit an annual certification on whether the Government of Hong Kong is able to exercise "autonomous decision-making" within its executive, legislative and judicial branches. 

Similar to the Hong Kong Policy Act Report, the annual certification on the "autonomous decision-making" of the Hong Kong Government is an evaluation of the degree of autonomy of Hong Kong from China.

The yearly certification will require the Secretary of State to evaluate whether the following treaties, international agreements and United States laws should continue to accord Hong Kong treatment different from China:

  1. Commercial agreements;
  2. Law enforcement cooperation, including extradition matters;
  3. Non-proliferation commitments;
  4. Sanctions enforcement;
  5. Export control agreements, including enforcement of export controls with respect to so-called dual-use technology;
  6. Formal treaties and agreements between the United States and Hong Kong, including agreements related to taxation and currency exchange;
  7. Other particular laws of the United States, or any provisions thereof, that accord to Hong Kong treatment different from that accorded to China; and
  8. Other bilateral or multilateral agreements determined relevant by the Secretary.

(c) Changes to Decision-making Process Concerning United States Visa Applications

The HK Human Rights Act, should it become law, will further amend the Hong Kong Policy Act, to impact the manner in which visa decisions are taken. More particularly, applications for United States visas by residents of Hong Kong should not be denied solely on the basis of "politically-motivated arrest, detention, or other adverse government action taken against such applicants as a result of the participation by such applicants in protest activities".

This provision was passed on a "sense of" Congress basis and, therefore, has no effect in law. However, it is an early signal that Congress may alter statutory provisions in the future if the provision does not influence the State Department and the granting of visas.

(d) President's Report on Transfer of United States Intellectual Property to China

The HK Human Rights Act will require the President to submit a report to the Congress within 180 days of enactment on his or her assessment of whether Hong Kong enforces the Export Control Reform Act of 2018, and the sanctions imposed by the United States and the United Nations.

The report specifically requires an assessment of whether United States-origin items (including software, technology, and services) have been transferred from Hong Kong to China in violation of United States law, and have been used by China for mass surveillance, predictive policing, or for the social credit system.

The bill does not propose any new export controls or sanctions. 

(e) Ongoing Obligation on the Secretary of State to Report to Congress on any Proposed Legislation in Hong Kong that may Adversely Impact United States Interests in Hong Kong 

The Secretary of State must notify the Congress of any proposed legislation in Hong Kong that would put United States citizens or lawful permanent residents at risk for rendition to China, or otherwise have a significant negative impact on United States interests with respect to Hong Kong, within 30 days of such proposal.

Such notification should include an assessment of the potential risk of the proposed legislation to United States national security, and a strategy for protecting United States interests in Hong Kong with respect to the proposed or enacted legislation.

(f) Action Against Persons Determined to be Responsible for Certain Behavior

Under the HK Human Rights Act the President will be required to produce an annual report listing every foreign person (both individuals and entities) who the President identifies based on credible information to be "knowingly responsible" for the following:

  1. The actual or threatened rendition, arbitrary detention, torture, or forced confession of any individual in Hong Kong;
  2. Repeated acts or decisions that contravene the shared obligations of China and Hong Kong under the Joint Declaration and Basic Law, and undermine the national interests of the United States in Hong Kong's autonomy and the rule of law; and
  3. Other gross violations of internationally recognized human rights in Hong Kong.

"Knowingly" is defined to mean that a person has actual knowledge, or should have known, of the conduct, the circumstance or the result.

The HK Human Rights Act, should it become law, will permit the sanction of these foreign persons by blocking all transactions in property and interests in property that are in the United States, come within the United States, or come within the possession or control of a United States person. It also imposes a visa ban on such foreign persons and his or her immediate family members.

A copy of the HK Human Rights Act, as passed by the U.S. House of Representatives, is available at https://www.congress.gov/bill/116th-congress/house-bill/3289/text.