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U.S. imposes sanctions on Hong Kong Chief Executive Carrie Lam and other government officials

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U.S. imposes sanctions on Hong Kong Chief Executive Carrie Lam and other government officials

At a Glance…

On August 7 2020, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) imposed sanctions on 11 Hong Kong and Chinese governmental officials, including Carrie Lam, the Chief Executive of Hong Kong. These individuals were added to OFAC’s Specially Designated Nationals and Blocked Persons List (SDN List) for “undermining Hong Kong’s autonomy and restricting the freedom of expression or assembly of the citizens of Hong Kong.”

Authors:  Leigh Hansson, Alexander Brandt, Eli Rymland-Kelly, Claire Don, Will Young, and Ray-Shio Ho

It is said that the action is being taken as a consequence of the individuals’ roles in developing, adopting, or implementing the Law of the People’s Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region and/or engaging in action or policies that threaten the peace, security, stability, or autonomy of Hong Kong.

It follows the recent signing of the Hong Kong Autonomy Act 2020 and Executive Order 13936, President Trump’s Executive Order on Hong Kong Normalization, on 14 July 2020; the latest in a series of U.S. measures in response to a perceived failure to maintain Hong Kong’s autonomous status and the use of “draconian national security legislation.”

The individuals that were designated are:

  • Carrie Lam, Chief Executive, Hong Kong Special Administrative Region (HKSAR)
  • Chris Tang, Commissioner of Hong Kong Police Force (HKPF)
  • Stephen Lo, Former Commissioner of HKPF
  • John Lee Ka-chiu, HKSAR Secretary for Security
  • Teresa Cheng, HKSAR Secretary for Justice
  • Erick Tsang, HKSAR Secretary for Constitutional and Mainland Affairs
  • Xia Baolong, Director of the Hong Kong and Macao Affairs Office of the State Council
  • Zhang Xiaoming, Deputy Director of the Hong Kong and Macao Affairs Office of the State Council
  • Luo Huining, Director of the Hong Kong Liaison Office
  • Zheng Yanxiong, Director, Office for Safeguarding National Security in Hong Kong
  • Eric Chan, Secretary General, Committee for Safeguarding National Security of the HKSAR

As a result of these sanctions, all property and interests in property of the designated individuals, and of any entities that are owned, directly or indirectly, 50 percent or more by them, individually, or with other blocked persons, that are in the United States or in the possession or control of U.S. persons, are blocked and must be reported to OFAC. U.S. persons are also prohibited from engaging in any dealings with the sanctioned individuals.

The designations are also of potential significance to non-U.S. persons, where Executive Order 13936 authorizes the imposition of sanctions on any person who provides “material support” to a person or entity sanctioned under its authorities.

Within the Treasury Department’s announcement, it states that the U.S. will continue to target those that implement “nefarious policies” that “degrade Hong Kong’s autonomy.” China has also responded, declaring its intention to subject 11 US citizens, including U.S. senators, to sanctions of its own. We therefore advise that both U.S. and non-U.S. persons continue to closely monitor the shifting sanctions landscape between the U.S. and China, as tensions between the two governments continue to mount.

How Reed Smith can help

Reed Smith’s sanctions team has extensive experience representing companies before OFAC. As a global firm, Reed Smith is particularly well positioned to provide guidance on U.S. sanctions and to represent your company before OFAC and other federal agencies implementing U.S. sanctions – such as the U.S. Department of Commerce and the U.S. Department of State – with highly experienced sanctions lawyers from the United States, United Kingdom, and EU available to you, 24/7. Contact one of the authors listed above or your usual Reed Smith lawyer, and we will be more than happy to help you navigate the implications of these significant events for your business.

If you have questions or would like additional information on the material covered in this Alert, please contact one of the authors – listed below – or the Reed Smith lawyer with whom you regularly work.

hansson

Leigh Hansson
Partner, London & Washington, D.C.
L: +44 (0)20 3116 3394
D.C.: +1 202 414 9394
lhansson@reedsmith.com

brandt

Alexander Brandt
Associate, London
+44 (0)20 3116 3733
abrandt@reedsmith.com

rymland-kelly

Eli Rymland-Kelly
Associate, London & Washington, D.C.
L: +44 (0)20 3116 3287
D.C.: +1 202 414 9287
erymland-kelly@reedsmith.com

don

Claire Don
Associate, London
+44 (0)20 3116 3827
cdon@reedsmith.com

young

Will Young
Associate, London
+44 (0)20 3116 3766
wyoung@reedsmith.com

ho

Ray-Shio Ho
Associate, London
+44 (0)20 3116 3773
rho@ReedSmith.com

Client Alert 20-486

August 2020

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