March 31, 2022
China Primer: Hong Kong
The Hong Kong Special Administrative Region (HKSAR,
From 1997 until 2019, Hong Kong operated with a high
or Hong Kong) is a semi-autonomous city located off the
degree of autonomy, and many residents resisted efforts by
southern coast of Guangdong Province, People’s Republic
the PRC government to increase its influence and control
of China (PRC or China). The city was established as a
over Hong Kong, particularly over electoral and national
British colony in 1841, and administered by the British
security issues. Hong Kong is governed by an indirectly-
government until 1997, when it was formally returned to
elected Chief Executive and Legislative Council (LegCo)
PRC jurisdiction. More than 90% of Hong Kong’s
and operates with a legal system based on British Common
population is ethnically Chinese. The first language of the
Law. Due to its strong institutions, including an
vast majority is Cantonese (a variety of Chinese different
independent legal system, Hong Kong became an important
from the Standard Mandarin recognized as the national
global trade and financial center, and a key window for
language by PRC law). English is also widely spoken and
trade, investment, and finance within the PRC. Under the
used in commercial and legal settings.
terms of the Joint Declaration, Hong Kong maintains
separate membership in more than 40 international
History of the HKSAR
organizations, including the World Trade Organization
In 1984, the United Kingdom and the PRC government
(WTO), the World Bank, the International Monetary Fund
signed an international treaty known as the Sino-British
(IMF), and the World Health Organization (WHO).
Joint Declaration on the Question of Hong Kong, or “Joint
Hundreds of U.S. companies maintain operations in Hong
Declaration.” Under the agreement, the UK agreed to
Kong, and the territory hosts the Asia headquarters of many
transfer sovereignty over Hong Kong to the PRC on July 1,
major multinational corporations.
1997. The PRC government, in turn, committed to ensure
that Hong Kong would continue to “enjoy a high degree of
Recent Developments
autonomy, except in foreign and defence affairs,” and “will
In recent years, the PRC and HKSAR governments have
be vested with executive, legislative and independent
acted in ways that appear to violate commitments under the
judicial power, including that of final adjudication.” The
Basic Law, i.e., those related to political and human rights.
PRC also promised the “[r]ights and freedoms, including
those of the person, of speech, of the press, of assembly, of
National Security Law
association, of travel, of movement, of correspondence, of
On June 30, 2020, China’s legislature approved a national
strike, of choice of occupation, of academic research and of
security law (NSL) for the HKSAR, which criminalizes the
religious belief will be ensured by law.” The Joint
organization and perpetration of terrorist activities,
Declaration required the PRC to pass a Basic Law for the
secession, subversion, and “collusion with a foreign country
HKSAR incorporating these commitments, and those
or with external elements to endanger national security.”
commitments were to “remain unchanged for 50 years.”
The PRC and HKSAR governments said that the law was
China’s National People’s Congress (NPC) passed the
necessary to restore order following large-scale protests in
“Basic Law of the Hong Kong Special Administrative
2019, and alleged that foreign “anti-China” forces were
Region (HKSAR) of the People’s Republic of China”
trying to bring chaos to Hong Kong.
(Basic Law) on April 4, 1990.
Hong Kong authorities have applied the NSL actively. In
February 2021, Hong Kong authorities charged 47 pro-
Hong Kong at a Glance
democracy figures with “conspiracy to commit subversion”
Population (2020): 7.5 mil ion
in connection to their involvement in organizing an election
Area: 1,082 square kilometers (418 square miles)
primary for the September 2020 LegCo elections. The NSL,
Currency: Hong Kong Dol ar (HKD)
as written, applies to alleged violations committed by
anyone, anywhere in the world, including in the United
Per Capita GDP (2020): US$59,092 (HK$462,020)
States. The maximum penalty for violations is life in prison.
Leadership: Chief Executive Carrie Lam (Cheng Yuet-ngor)
The NSL also allows the PRC government to exercise
Legislature: Unicameral Legislative Council (LegCo) with 90
jurisdiction over alleged violations of the law and prosecute
members elected by fixed geographical and functional
and adjudicate the cases in mainland China.
constituencies.
Key Industries (by % of 2020 GDP value added):
The Hong Kong Police Force (HKPF) has arrested more
Financial Services (23.3%), Trading and Logistics (19.8%), and
than 10,000 people for alleged crimes committed during the
Professional Services (11.6%)
2019 protests. More than 2,300 arrestees have been charged
in Hong Kong courts; more than 200 have been convicted,
Source: Hong Kong Census and Statistics Department,
including about 140 who pleaded guilty. The HKSAR
Economist Intelligence Unit (EIU)
increasingly seems to be wielding the NSL as an instrument
https://crsreports.congress.gov
China Primer: Hong Kong
of political repression, and has censored pro-democracy
states, “Support for democratization is a fundamental
media outlets and arrested their leadership and senior
principle of United States foreign policy.”
editorial staff. As of January 2022, the HKPF had arrested
162 people for alleged crimes related to the NSL. In some
U.S. Policy Response to Developments in Hong
cases, the accused have been remanded without bail. For
Kong
more about the NSL, see CRS Report R46473, China’s
On July 14, 2020, in response to the NSL, then-President
National Security Law for Hong Kong: Issues for Congress.
Trump issued an Executive Order on Hong Kong
Normalization (E.O.13936). The executive order stated that
Electoral and Institutional Changes
the HKSAR “is no longer sufficiently autonomous to justify
Until about 2016, legal experts saw Hong Kong’s elected
differential treatment in relation to the People’s Republic of
LegCo as a relatively robust check on what is otherwise an
China,” and suspended U.S. treatment of Hong Kong as
“executive-led” system, and some of its elected members
separate from the PRC for trade and political purposes. It
were among the most critical of the central government’s
also authorized the Secretaries of State and the Treasury to
role in the HKSAR. The electoral landscape changed as a
impose visa and economic sanctions on HKSAR and PRC
result of the NSL and pre-existing HKSAR government
officials determined to be responsible for the erosion of the
efforts to quell popular demands for direct democracy.
HKSAR’s autonomy, the undermining of democracy, or the
Hong Kong courts disqualified six pro-democracy members
loss of the rights of Hong Kong residents. Since the
of the LegCo in 2016 and 2017 for allegedly expressing
issuance of E.O.13936, 20 PRC officials and 8 HKSAR
anti-government sentiment during their oaths of office. In
officials have been sanctioned, including HKSAR Chief
November 2020, the government disqualified four members
Executive Carrie Lam and the HKPF Commissioner.
of LegCo after the Standing Committee of the NPC
established new qualifications to be a LegCo member. The
On March 31, 2021, the Biden Administration indicated it
following day, 15 members of LegCo’s pro-democracy
would maintain the suspension of differential treatment of
coalition resigned in protest.
HKSAR. The HKSAR and PRC governments have
condemned the passage of the Hong Kong-related laws, the
In March 2021, the NPC modified Hong Kong’s electoral
issuance of E.O.13936, the suspension of Hong Kong’s
system and created a vetting system to try to ensure only
special treatment, and the imposition of sanctions on
“patriots” run for office. The December 2021 LegCo
officials. The HKSAR government described the sanctions
Elections saw the lowest voter turnout among geographical
as “blatant interference in the internal affairs of the PRC,
constituencies in the history of the HKSAR (30.2%). As of
violating international law and basic norms governing
February 2022, LegCo is composed of 90 members, all but
international relations.” The PRC has imposed visa and
one of whom critics see as pro-PRC candidates. The PRC
other sanctions on U.S. officials. For more, see CRS Legal
has similarly pressured Hong Kong’s independent judiciary,
Sidebar LSB10488, Revoking Hong Kong’s Preferential
with some PRC officials suggesting that judges should be
Trade Status: Legal Framework and Implications.
“patriotic” and consider the interests of both the HKSAR
and PRC in their decisions.
Issues for Congress
Congress historically took an interest in Hong Kong as an
Coronavirus Disease 2019 (COVID-19)
international financial center and facilitator of U.S. trade
While Hong Kong initially experienced few cases during
and financial ties with the PRC, as reflected by provisions
the pandemic, in early 2022, COVID-19’s Omicron variant
in P.L. 102-383. Following the PRC’s crackdowns on Hong
led to a surge in cases. In early March 2022, Hong Kong
Kong in 2014 and 2019, congressional interest expanded to
authorities reported the hospitals had reached capacity and
include threats to the rights of Hong Kong residents; the
began constructing temporary care and quarantine facilities.
expansion of PRC surveillance and harassment of
Some contend the HKSAR government’s alignment with
journalists, NGOs or other organizations, including U.S.
the central government’s “zero COVID” strategy and
entities; erosion of the rule of law; and the possible
reliance on PRC-manufactured vaccines exacerbated Hong
departure of international businesses.
Kong’s Omicron wave. Hong Kong’s real GDP contracted
by 6.1% in 2020, which several experts attribute to its
The 116th Congress passed three Hong Kong-related laws.
international and service-oriented economy, which were
The Hong Kong Human Rights and Democracy Act of
strained under travel and other restrictions. HKSAR
2019 (P.L. 116-76) and Hong Kong Autonomy Act (P.L.
authorities also cited COVID-19 as a rationale for
116-149) require the President to impose sanctions on PRC
restricting demonstrations and delaying elections scheduled
and HKSAR officials implicated in undermining democracy
for September 2020 to December 2021, despite criticism
and human rights in Hong Kong, while P.L. 116-77
from democracy advocates in Hong Kong and overseas.
prohibited the sale of U.S. riot control equipment to the
HKPF. In the 117th Congress, language in versions of the
U.S. Policy
U.S. Innovation and Competition Act (S. 1260) and the
U.S. relations with Hong Kong are governed by the United
America COMPETES Act (H.R. 4521) includes provisions
States-Hong Kong Policy Act of 1992 (USHKPA; P.L. 102-
that would extend prohibitions on the export of equipment
383), which commits the United States to treating the
to the HKPF, appropriate additional funding for promotion
HKSAR as separate from the rest of China in a variety of
of democracy, and require the executive branch to report on
political, economic, trade, and other areas so long as the
Hong Kong’s role in PRC trade and industrial policies.
HKSAR remains “sufficiently autonomous.” The act also
Ricardo Barrios, Analyst in Asian Affairs
https://crsreports.congress.gov
China Primer: Hong Kong
IF12070
Michael D. Sutherland, Analyst in International Trade and
Finance
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https://crsreports.congress.gov | IF12070 · VERSION 1 · NEW