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HSBC must end support for Beijing’s crackdown

4 min read

When the pioneering Scotsman Thomas Sutherland founded the Hong Kong and Shanghai Banking Corporation in 1865, he did so on the promise of ‘sound Scottish banking,’ renowned for its fairness, dynamism, and community service.

Over the years, however, the UK-based bank has strayed far from its founding vision. Since the Chinese Communist Party’s (CCP) full-blown assault on Hong Kong’s autonomy, democracy, and fundamental freedoms, HSBC appears to have facilitated the crackdown and financial coercion of dissidents and departees by not standing up to the National Security Law on human rights grounds.

In a new inquiry by the All-Party Parliamentary Group (APPG) on Hong Kong, we uncovered comprehensive evidence on UK banks operating in Hong Kong underpinning this charge. Our report demonstrates clear and systematic breaches of basic human rights.

HSBC’s collusion with the CCP began with the bank’s public and proactive support of Beijing’s national security law in Hong Kong. Imposed in 2020 in a bid to curb growing calls for democratic reform, the draconian security law has criminalised dissent, curtailed freedoms of expression, assembly, and the press, and wiped out the territory’s promised autonomy.

Successive UK governments have rightly declared China to be in a state of ongoing non-compliance with the Sino-British Joint Declaration, which enshrined Hong Kong’s freedoms after the handover. However, even as the full scale of Beijing’s brutality has become apparent, HSBC has persisted in its support of the security law.

The bank’s complicity extends far beyond vocal support. Our inquiry revealed that HSBC and others had systematically prevented Hongkongers who have left the territory on the British National (Overseas) (BN((O)) visa from accessing their pensions with the bank.

In Hong Kong, residents are entitled to withdraw their pension funds early should they provide proof of permanent departure. As Hong Kong authorities no longer recognise the BN(O) visa as legitimate documentation, however, status holders have been denied access to their funds by providers, including HSBC.

More than 150,000 Hongkongers have sought BN(O) status, creating a devastating impact on lives and livelihoods.

For Hongkongers recently settled in the UK, it has deprived them of their right to property, including basic personal finances. Meanwhile BN(O) holders still in Hong Kong have had their ability to relocate to the UK severely restricted.

In both cases, by preventing BN(O) holders from accessing their pension funds, HSBC’s actions constitute clear suppression of fundamental human rights – they are at odds with the UN Guiding Principles on Business and Human Rights which state that “all business enterprises have the same responsibility to respect human rights wherever they operate,” and must respect this to the greatest possible extent given domestic circumstances.

HSBC’s response betrays either a naive misunderstanding or wilful misreading of international law and human rights principles

As we concluded in our report, HSBC: “narrowly interprets the UN Guiding Principles… by only recognising that the reference to ‘all applicable laws’ refers to domestic laws such as the National Security Law, when in fact the principles also refer to applicable international human rights laws.”

The bank has also enabled Beijing’s targeting of political opponents. In December 2020, at the behest of the authorities, HSBC froze the accounts of former Hong Kong legislator and pro-democracy activist, Ted Hui, and his family, on accusations of money laundering that have been described as “trumped up”.

In defence of its actions, the bank argued that it was ‘bound to comply’ with local laws and “lawful” instructions. HSBC’s response betrays either a naive misunderstanding or wilful misreading of international law and human rights principles, as our APPG report makes clear.

HSBC has been blithely compliant with the CCP’s consistent breaches of international human rights law, whether through the collective punishment of BN(O) status holders, or financial sanctions against political opponents. The bank has failed to meet basic human rights responsibilities.

The bank must redress its dereliction of legal and moral duty towards Hongkongers, if necessary, consulting legal experts and other stakeholders in order to meet international human rights standards. The UK government must also play its part to ensure the rights of Hongkongers in the UK and Hong Kong are upheld by HSBC and other UK banks operating in the territory.

Now is the time to consider sharper deterrents for UK banks that persist in supporting the national security law, to demand banks unfreeze the accounts of political dissidents and to work with banks to ensure Hong Kong BN(O)s can rightfully access their pension contributions. If HSBC and other banks will no longer live up to international human rights principles, then it is up to the rest of us to hold them to account.

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