Two stories about sanctions

The Committee for Freedom in HK report on Hong Kong companies helping Russian, North Korean and Iranian entities avoid sanctions is here. A synopsis from author Samuel Bickett…

Some of our most significant findings:

• Hong Kong’s exports of advanced tech to Russia surged after the invasion of Ukraine, with $750 million of shipments in Dec 2023–nearly 40% of the total–consisting of items on a US/EU list of the most essential components for Russia’s military systems.

• Hong Kong companies have long supported North Korea’s illicit shipping operations, facilitating ship-to-ship transfers and the creation of fraudulent ship identities to evade international sanctions.

• Hong Kong companies have facilitated the transfer of advanced drone and missile technology to Iran, which has been used to support military efforts in the Middle East and beyond, and facilitated the illicit sale of Iranian oil via ship-to-ship transfers at sea.

In the report, we call out by name companies and individuals who appear to be participating in these activities, using information found via Russian customs records collected by global security nonprofit C4ADS, Hong Kong corporate records, vessel tracking data, leaked Iranian emails, and other materials.

Story in tech publication the Register, saying ‘government doesn’t seem to mind’. And in Tradewinds…

Hong Kong has become vital to Russia’s efforts to evade sanctions by providing a “safe haven” for blacklisted shipowners to operate beyond the reach of Western regulators, according to a report.

…China does not recognise unilateral sanctions and the region’s chief executive, John Lee, said in October 2022 that Hong Kong would not enforce global sanctions against Moscow.

The comments gave the green light to “illicit operators to set up shop in the city”, said the report by the Committee for Freedom in Hong Kong Foundation.

“Many have done so, from Russian tanker owners to Iranian exporters of drone technology.”

The report also covers Hong Kong’s role as an operational hub for shipping goods to and from other sanctioned nations, Iran and North Korea.

The report urges Western regulators to blacklist Hong Kong and Chinese banks along with logistics firms, insurers and corporate registry services.

No official response as yet. It will need more than the usual boilerplate.

Calling for sanctions counts as ‘conspiracy to collude with foreign forces’ under Hong Kong’s NatSec Law. Which brings us to Jimmy Lai, who is being tried for urging overseas politicians and governments to impose sanctions on Hong Kong individuals such as government officials. His lawyers are arguing that there is no case to answer…

[Senior Counsel Robert] Pang said: “There may be some evidence of agreement to publish certain articles… to work with some organisations, but there is no evidence after the NSL was promulgated.”

From the Standard…

[Pang] said in a half-time submission that the prosecution’s description of the now-defunct Apple Daily as Lai’s political platform was “weird,” as it was a newspaper that exercised the watchdog role of the fourth estate in criticizing the government and publishing commentaries from different perspectives.

Pang said press freedom and freedom of speech are protected by the Basic Law and Hong Kong Bill of Rights Ordinance.

…Pang conceded that Lai had requested sanctions before the law was implemented but insisted he stopped doing so upon realizing it could constitute a criminal offense with the law’s enactment.

Instead, Lai only expressed his views in articles and talk shows.

Regarding the conspiracy charge, Pang said it has to involve unlawful conduct or means, and without the “unlawful” element, the “conspiracy” would only amount to an agreement.

Lai, he said, might have reached agreements with some people, but they were made legally before the implementation of the law.

This is a NatSec court. They have a 100% conviction rate, apart from two acquittals in the HK47 case – which the government is appealing.