Hong Kong Police have been given immense powers enabling increased surveillance and enforcement. The law allows police to ask electronic platforms to remove, and block content deemed a national security risk.
According to an announcement, the authority will start implementing article 43 of the security legislation beginning Tuesday, July 7, 2020. The bill is part of Beijing’s controversial National Security Law. The widely criticized new law has prompted fear. Howeve, the local leader Carrie Lam has maintained that the widely criticized legislation is “relatively mild.”
The Hong Kong leader defended the legislation China imposed last week, which her government’s assented. They include warrant-less searches, online surveillance and property seizures. Lam told press briefing before meeting her advisory Executive Council:
“This law will be enforced very stringently, and people’s concerns will be eased […] you will see that people will not regularly fall afoul of the law.”
With the new law, police can remove online content. The move embeds unprecedented control over the Internet in a city outside of China’s “Great Firewall”. They can delete any post they decide is likely to constitute or cause “an offence endangering national security.”
The exodus of International Companies
The new measures were announced a short time after a report by AFP stating that Facebook and WhatsApp had vowed not to honor requests for encrypted data by Hong Kong Authorities. Google and Twitter had temporarily halted processing such requests.
Lam failed to respond to adequately a question regarding the decision by Google, Facebook Inc. and Twitter Inc. IT Sector lawmaker Charles Mok warned the new powers would fuel an exodus of international companies from the city. A local media house quoted Mok:
“It is deeply worrying that these companies may have to reassess the risk of doing business in Hong Kong, and[…] similar to some of these companies decision previously to exit from the Chinese mainland market[…] will they have to make that kind of decision for Hong Kong?”
Consequences for Global Commerce
The newly implemented Hong Kong national security law will have implications for privacy, cybersecurity, data, and trade issues. Similar to a bill passed by US senators, the new developments will have far-reaching consequences for global commerce. They will transform the ways that foreign companies operate in Hong Kong.
More blockchain and crypto companies than other Fintech firms set up shop in Hong Kong in 2019. Blockchain outgrew the wealth tech, payments, cybersecurity, regulatory tech and credit tech. The growth figures depict a region courting firms across the blockchain and cryptocurrency ecosystem. However, the new police laws pose a risk for successful DeFi lenders like crypto.com. Blockchain and crypto-based businesses thrive on encryption, something the new laws are likely to challenge.