Tuesday 1 December 2020 12:01 am

Tory MPs urge PM to sanction UK banks in Hong Kong for China cooperation

Boris Johnson should threaten to sanction UK financial services firms operating in Hong Kong to push back against Beijing’s draconian security laws, according to a new report from top Tory backbenchers.

A report from Westminster’s China Research Group, which is led by Conservative MPs Tom Tugendhat and Neil O’Brien, says the UK should sanction banks that help implement the new legislation and curtail human rights.

Read more: UK considers removing British judges from Hong Kong high court

This includes major British firms such as HSBC, Standard Chartered, Barclays and NatWest.

The report said Johnson should also enact sanctions against UK companies that use forced Chinese labour in their supply chains and freeze the British assets of a swathe of Chinese nationals who have engaged in human rights abuses.

Beijing enforced new security laws in Hong Kong earlier this year, which make it illegal to criticise the Chinese government and prohibits things like mocking the Chinese national anthem.

Foreign secretary Dominic Raab branded them a violation of the British-Sino treaty, which was signed when the region’s handover to China was agreed.

The China Research Group report points out that major banks with Hong Kong operations have been ordered by Beijing to report financial transactions that may be in violation of the draconian new laws.

Before the Open newsletter: Start your day with the City View podcast and key market data

The US has responded with this request by enacting legislation that sanctions any company or individual that complies with the security laws by freezing assets.

The group of MPs argues that the UK government should do likewise to force British banks to push back against the Chinese government.

The report said: “If London were to reciprocate the bipartisan consensus in Washington by imposing similar sanctions on financial institutions, it could become difficult for those institutions to fully comply with the  national security law, effectively pushing back on continued expansion of CCP influence in Hong  Kong.”

Neil O’Brien, who was recently appointed to a policy advisory role in Downing Street, said: “The Chinese government has been hard on companies like HSBC to make them support the new security law.

“The actions they are taking to put pressure on these firms will only make more people wary about investing in China.”

HSBC and Standard Chartered were criticised earlier this year for supporting Beijing’s freedom of speech crackdown.

Both firms released statements in support of the new security legislation shortly after it was announced.

Read more: HSBC and Standard Chartered slammed for supporting China’s Hong Kong security law

Raab hit out at the firms for their support of the Chinese government, saying in August that “the rights and the freedoms and our responsibilities in this country to the people of Hong Kong should not be sacrificed on the altar of bankers’ bonuses”.

HSBC and Standard Chartered were contacted for comment.