Congress clears sanctions bill to punish China over Hong Kong
Chinese officials responsible for crackdown on Hong Kong could face economic sanctions under bill awaiting President Trump's signature
Congress on Thursday cleared legislation for the president that would require U.S. sanctions on Chinese officials violating human rights in Hong Kong while also threatening penalties on foreign banks that support Beijing’s crackdown on the formerly autonomous territory.
Lawmakers were spurred to action after Beijing earlier this week enacted in swift fashion a new harsh anti-sedition law, which will effectively supplant Hong Kong’s famously independent justice system with the mainland's.
The so-called “national security” law uses broad language to criminalize a range of actions the Chinese government interprets as constituting terrorism, subversion, advocacy for secession and collusion with foreign powers. The measure also asserts extra-territorial jurisdiction against those working abroad to subvert China’s Hong Kong policies.
“The United States needs to send a very clear message that we will not stand idly by while the authoritarian government in China violates its international agreements and snuffs out the rights of the people in Hong Kong,” Sen. Chris Van Hollen, a primary co-sponsor of the sanctions bill, said in a press call.
The Senate agreed by unanimous consent to pass the sanctions measure, which the House passed in the same manner Wednesday.
The measure was originally developed by Sen. Patrick J. Toomey, R-Pa., and Van Hollen, D-Md., and passed out of the Senate last week. However, concerns that the bill would impact revenue and thus should originate in the House led to the decision to pass the House legislation after it was amended to include technical fixes sought by the Treasury Department and previously agreed to by the Senate.
“I just think it is very, very important that we be on the side of people who are calling out for their own freedom,” Toomey told reporters. “I am very, very grateful that we were able to get this done. I am very confident that the president is going to sign it into law. It puts us on the right side of this very important battle.”
Toomey and Van Hollen are confident that President Donald Trump will sign the bill because lawmakers in both chambers were unanimous in their support of the measure. Trump has done little to criticize Chinese President Xi Jinping’s increasingly rough and unyielding treatment of the onetime British colony.
Trump reluctant to act
Congress late last year passed a measure that would authorize the president to sanction Chinese officials involved in oppressing Hong Kong. Since then, the Trump administration has done little with its new authorities, though Secretary of State Mike Pompeo announced last week visa bans on any Chinese Communist Party officials deemed complicit in the crackdown on Hong Kong.
The administration earlier this week announced it was ending exports of defense equipment and other sensitive technology to Hong Kong. While defense exports comprise a sliver of commerce between the United States and Hong Kong, Pompeo has left the door open to more significant curtailments of the Asian financial hub’s special trade privileges. Pompeo on Wednesday did not offer a timeline for stricter economic penalties against Hong Kong and Beijing.
“It isn’t enough to simply make rhetorical statements, statements need to be backed up by action,” Van Hollen said, emphasizing that the sanctions provisions in the new measure are mandatory rather than discretionary on the executive branch.
The Toomey-Van Hollen measure would require the State Department within three months to produce a list of individuals it determines are primary offenders in the crackdown on Hong Kong. Individuals on the list could be low-ranking police officers in Hong Kong who brutalize democracy protesters all the way up to the senior Chinese Communist Party officials involved in the drafting of the anti-sedition law.
Individuals included on that human rights violators list would have one year to contest their inclusion on the list or to demonstrate they have ceased their objectionable behavior. After a year, anyone still on the list would be subject to mandatory sanctions such as travel bans and asset freezes.
The measure further would require the Treasury Department within five months to produce a list of “any foreign financial institution that knowingly conducts a significant transaction with a foreign person identified” in the State Department’s Hong Kong human rights violators report.
If those identified banks continue to do business with blacklisted individuals, then after one year they would be subject to a range of financial sanctions that the executive branch is initially given discretion in choosing from. Those sanctions range in severity from visa bans for bank executives to restrictions on the ability of a bank to use the U.S. dollar in its transactions.
The full range of sanctions would become mandatory on the financial institution in the second year if the bank continues to do business with designated human rights violators.
A provision allowing an administration to waive penalties if it's in U.S. "national security interest" is included in the bill. But should the Trump administration or others in the future abuse the waiver for non-security purposes, Van Hollen and Toomey also included in their bill an expedited voting procedure that would allow Congress to overturn the waiver.
The president, in theory, could veto Congress’ decision to overturn a waiver. However, Van Hollen said the unanimous passage of the legislation — coupled with growing bipartisan lawmaker alarm about Xi’s authoritarian actions — makes him confident Capitol Hill will press to see the sanctions measures enacted unless Beijing reverses course in its harsh treatment of Hong Kong.
“The Treasury [Department] has endorsed the legislation,” Toomey said. “I am confident that it will be properly enforced.”