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US warns business risks in Hong Kong

THE US warned that China’s new national security law could be a risk of doing business in Hong Kong.

A new business advisory tells multinational firms that they are subject to the laws and that their people could be arrested under them.

Other risks may include having to surrender data to Chinese authorities.

President Biden said that "the situation in Hong Kong is deteriorating".

"The Chinese government is not keeping its commitment about how it would deal with Hong Kong," the president warned.

The national security law was introduced in Hong Kong last year after protests over an extradition law turned violent and evolved into a broader anti-China and pro-democracy movement.

The advisory covers several other areas including freedom of the press, data privacy and sanctions imposed by both sides.

As part of the update on Friday, the US also announced sanctions against seven Chinese officials over what it describes as an "erosion of the rule of law".

Jeff Moon, a former assistant US trade representative who worked on Hong Kong policy during the Obama administration, said, "I think this is quite serious amd a reflection of the dramatic changes that have gone on in Hong Kong."

According to the American Chamber of Commerce in the city, about 280 companies have regional headquarters there.

It said in a statement that it was aware "of an increasingly complicated geopolitical environment and its risks".

"We are here to support our members to navigate those challenges and risks while also capturing the opportunities of doing business in this region," it said.

Businesses with operations or staff in Hong Kong should consider potential reputational and legal risks, the advisory says.