Various US tech companies are facing hard choices regarding how the new national security law on Hong King will affect their operations in the state. Under the new law, Beijing requires the companies to turn over user data to authorities or censor content violating the law in Hong Kong.
US Tech Giants Face Uncertainty In Hong Kong
US tech giants Facebook (FB) Google (GOOGL) and Twitter (TWTR) have voiced concern about the new security law. The law gives authorities powers to police public and online spheres. The companies have indicated that they will no longer process government data requests but this could be a stop-gap move as they contemplate the next alternatives. Although Hong Kong is not a huge market for the companies, it is nonetheless a perch for the companies to reach advertisers in mainland china where they are blocked.
Even Chinese owned TikTok has indicated that it will pull out of Hong Kong in the coming days. TikTok which is owned by ByteDance insists it operates independently despite its Beijing roots. For the viral video sharing app, the move to leave Hong Kong might be to escape censoring of content or sharing of user data. However, the move for TikTok to leave will be a benefit to Chinese authorities who will have removed a platform pro-democracy protesters have been using. With the passing of the new law, China will prosecute whatever it considers national threats.
US Congress Passes Bill To Sanction Those Undermining Hong Kong
The US Congress has passed a bill requiring the State Department and Treasury to impose penalties and entities and persons that have undermined the sovereignty of Hong Kong. The bill gives the President the authority to deny US entry and block assets of those involved.
Financial institutions doing business with sanctioned parties could also be penalized. This is a blow to US banks whose foreign subsidiaries have Chinese officials. Although the bill has not been signed, President Trump has the support of Congress, and once enacted the State Department will within 90 days submit a report on companies or individuals meriting sanctions.
