Executive Order 13936

Executive Order 13936, entitled "The President’s Executive Order on Hong Kong Normalization", is an executive order signed by U.S. President Donald Trump on July 14, 2020.[1] On the same day Trump had signed into law Hong Kong Autonomy Act, one of the laws from which the order derives authority. The act and the executive order are the US's response to the imposition of a controversial national security law in Hong Kong by the Standing Committee of the National People's Congress of China on June 30, 2020, which was described as "an unusual and extraordinary threat [...] to the national security, foreign policy, and economy of the United States" in the preamble.

Executive Order 13936
The President’s Executive Order on Hong Kong Normalization
President Donald Trump signing the order at the Resolute desk, with Secretary of the Treasury Steven Mnuchin (left) and Secretary of State Mike Pompeo (right)
TypeExecutive order
Executive Order number13936
Signed byDonald Trump on July 14, 2020 (2020-07-14)
Federal Register details
Federal Register document number2020-15646
Publication dateJuly 17, 2020 (2020-07-17)
Document citation85 FR 43413
Summary
Suspends or eliminates different and preferential treatment for Hong Kong

According to Trump, he said the executive order was to "hold China accountable for its aggressive actions against the people of Hong Kong", and Hong Kong would be treated the same as China.[2] The order directs government agencies to eliminate preferential treatments given to Hong Kong as compared to Mainland China.

Background
See also: Hong Kong Autonomy Act

The Hong Kong Policy Act of 1992 (HKPA), last amended by the Hong Kong Human Rights and Democracy Act of 2019, is the groundwork for the US policies that maintain relations with Hong Kong as separate from Mainland China, to the extent consistent with the 1984 Sino-British Joint Declaration, after the transfer of sovereignty over Hong Kong.[3] While existing US laws and certain international agreements continue to apply to the Hong Kong Special Administrative Region after July 1997, section 202 of the act allows the US president to issue an executive order to suspend such treatments if he determines that Hong Kong is "is not sufficiently autonomous to justify treatment" different from that accorded China under US laws.

In May 2020, after the Chinese National People's Congress decision on Hong Kong national security legislation was adopted, Secretary of State Mike Pompeo reported to the US Congress that Hong Kong was no longer autonomous.[4] Following the enactment of the Hong Kong national security law by Standing Committee of the National People's Congress in June 2020, the US Congress promptly and unanimously passed the Hong Kong Autonomy Act.

Provisions

The measures introduced in the executive order include:[3]

Implementations

Sanctions
Search result of Carrie Lam, the Chief Executive of Hong Kong, in the OFAC Saction List (i.e. SDN List)

On August 7, 2020, pursuant to the order, the US Department of the Treasury imposed sanctions on 11 individuals for "undermining Hong Kong's autonomy and restricting the freedom of expression or assembly", including:[5]

On 9 November 2020, 4 more individuals were sanctioned:[6]

  • Li Jiangzhou, Deputy Director of the Office for Safeguarding National Security
  • Edwina Lau Chi-wai, head of the National Security Division of the Hong Kong Police Force
  • Steve Li Kwai-Wah, Senior Superintendent of the Hong Kong Police Force
  • Deng Zhonghua, Deputy Director of the Hong Kong & Macau Affairs Office (HKMAO)

On December 7, 2020, pursuant to the order, the US Department of the Treasury imposed sanctions on the entire 14 Vice Chairpersons of the National People's Congress of China, for "undermining Hong Kong's autonomy and restricting the freedom of expression or assembly", including:[7]

On 15 January 2021, 6 more individuals were sanctioned, including:[8]

  • You Quan, Vice Chairman of the Central Leading Group on Hong Kong and Macau Affairs
  • Sun Wenqing AKA Sun Qingye, Deputy Director of the Office for Safeguarding National Security in the HKSAR
  • Tam Yiu-Chung, Hong Kong delegate to the National People's Congress Standing Committee
  • Frederic Choi Chin-Pang, official in the National Security Division of the Hong Kong Police
  • Kelvin Kong Hok-lai, official in the National Security Division of the Hong Kong Police
  • Andrew Kan Kai-yan, official in the National Security Division of the Hong Kong Police

Also subject to sanctions on August 7th, 2020, corresponding with an action by the United Nations Security Council, is Bi Sidi Souleymane from the Central African Republic. The militia group Return, Reclamation, Rehabilitation (3R), is responsible for the killing, torture, rape, or displacement of thousands since 2015 under his leadership.[9]

As a result of their inclusion in the Specially Designated Nationals List, all of the property and interests in property in the United States are blocked for the sanctioned and must be reported to the Office of Foreign Assets Control. All United States citizens are prohibited from transactions (including the contribution or provision of funds, goods or services) involving the property or interest of the eleven sanctioned persons.

Country of origin marking of products

The executive order suspended the application of section 201(a) of HKPA to section 304 of the Tariff Act of 1930 (19 U.S. Code § 1304),[1][10] which stipulates that every article of foreign origin shall be marked the English name of the country of origin. On August 11, 2020, US Customs and Border Protection (USCBP) announced that the imported goods produced in Hong Kong could no longer indicate themselves as "Made in Hong Kong" after September 25, but must indicate "China" as the country of origin instead.[11] This reversed the practice announced by the then-US Customs Service in June 1997, which determined that that goods from Hong Kong should continue to indicate their origin as "Hong Kong" after July 1, 1997.[12]

This change does not affect the reporting for purposes of assessing duties under the Harmonized Tariff Schedule of the United States.[13]

Suspension or termination of three bilateral agreements

On August 18, 2020, the Consulate General of the United States in Hong Kong notified the government of Hong Kong that the United States had suspended or terminated three bilateral agreements: for the surrender of fugitive offenders, for the transfer of sentenced persons and for reciprocal tax exemptions on income derived from the international operation of ships. The US Department of State referred to this as part of the implementation measures set forth in the executive order.[14][15]

Responses

Signing of the executive order

China's ministry of foreign affairs criticized the US for interfering in "purely China’s internal affairs", namely the implementation of a law that safeguards the country's national security. The spokesperson urged to US to "correct its mistakes", otherwise China will give "firm response" and impose sanctions on relevant US persons.[16]

The HKSAR government, in addition to reiterating the necessity of the national security law, said the SAR's special status as a separate customs territory, under the "One Country, Two Systems" principle, is conferred by the PRC Constitution and the Hong Kong Basic Law. It warned the US that unliteral measures that limit normal business activities would affect its own interests, and stressed that the measures imposed under Hong Kong Autonomy Act and the executive order "do not have any legal effect" on Hong Kong's financial institutions. It might also consider taking actions against the US under the rules of the World Trade Organization (WTO).[17]

Countersanctions

On August 11, 2020, China imposed sanctions without specification on eleven US individuals, namely Senators Marco Rubio, Ted Cruz, Josh Hawley, Tom Cotton and Pat Toomey, Representative Chris Smith, Carl Gershman (president of the National Endowment for Democracy), Derek Mitchell (president of the National Democratic Institute), Daniel Twining (president of the International Republican Institute), Kenneth Roth (executive director of the Human Rights Watch) and Michael Abramowitz (president of Freedom House). The spokesman of the foreign ministry said the sanctioned "behaved badly" on Hong Kong-related issues. Rubio, Cruz and Smith had been put on a travel ban by China.[18]

Criticism by Hong Kong Commerce Secretary

Hong Kong's commerce secretary Edward Yau condemned USCBP's measures, saying labelling a product from Hong Kong as "made in some other place" was "calling white black". He added that this practice did not comply with WTO rules, as it undermined Hong Kong's status as a separate customs territory.[19]

Bilateral agreements

Hong Kong government severely reprimanded the US on August 20, denouncing such acts as having "[politicized] juridical co-operation" which damaged the basis of juridical cooperation between the governments. As a result, Hong Kong government announced that it had, at the central government's instruction, notified the US Consulate General of the suspension of the agreements of surrender of fugitive offenders and of mutual legal assistance on criminal matters.[15] It said it would continue to upload the principle of mutual assistance and reciprocity.

References
  1. The White House, Office of the Press Secretary (July 14, 2020), The President's Executive Order on Hong Kong Normalization, archived from the original on July 15, 2020, retrieved August 8, 2020
  2. Mason, Jeff; Holland, Steve (July 15, 2020). "China vows retaliation after Trump ends preferential status for Hong Kong". Reuters. Archived from the original on August 5, 2020.
  3. "Executive Order Eliminates Differential Treatment for Hong Kong" (PDF). Cleary Gottlieb Steen & Hamilton LLP. July 21, 2020. Archived (PDF) from the original on September 30, 2020.
  4. "Hong Kong 'no longer autonomous from China' – Pompeo". BBC. May 27, 2020. Archived from the original on May 27, 2020.
  5. "Treasury Sanctions Individuals for Undermining Hong Kong's Autonomy". US Department of the Treasury. August 7, 2020. Archived from the original on August 7, 2020.
  6. "Designations of Four PRC and HK Officials Threatening the Peace, Security, and Autonomy of HK". U.S. Consulate General Hong Kong & Macau. November 9, 2020. Retrieved January 16, 2021.
  7. "SPECIALLY DESIGNATED NATIONALS LIST UPDATE". December 7, 2020. Archived from the original on December 7, 2020. Retrieved December 7, 2020.
  8. "Designating PRC and Hong Kong Officials after Widespread Pro-Democracy Arrests in Hong Kong". U.S. Consulate General Hong Kong & Macau. January 16, 2021. Retrieved January 16, 2021.
  9. "Archived copy". Archived from the original on August 22, 2020. Retrieved August 9, 2020.CS1 maint: archived copy as title (link)
  10. "US CBP issues notice requiring goods produced in Hong Kong to be marked as products of China | Knowledge | Norton Rose Fulbright". Norton Rose Fulbright (11 August 2020). Archived from the original on December 10, 2020. Retrieved August 24, 2020.
  11. "Country of Origin Marking of Products of Hong Kong". US Customs and Border Protection. August 11, 2020. Archived from the original on September 1, 2020.
  12. "Country of Origin Marking of Products of Hong Kong". US Customs Service. June 5, 1997. Archived from the original on December 10, 2020.
  13. "Frequently Asked Questions - Guidance on Marking of Goods of Hong Kong – Executive Order 13936". U.S. Customs and Border Protection. Archived from the original on September 10, 2020. Retrieved August 14, 2020.
  14. "Suspension or Termination of Three Bilateral Agreements With Hong Kong". U.S. Department of State. August 19, 2020. Archived from the original on August 20, 2020. Retrieved August 20, 2020.
  15. "Suspension of agreement on surrender of fugitive offenders and agreement on mutual legal assistance in criminal matters between Hong Kong and the US". Government of Hong Kong. August 20, 2020. Archived from the original on August 23, 2020.
  16. Davidson, Helen (July 15, 2020). "China promises 'firm response' to Trump's order ending Hong Kong's special status". The Guardian. Archived from the original on August 7, 2020.
  17. "HKSARG firmly opposes the Hong Kong Autonomy Act becoming US law". Government of Hong Kong. July 15, 2020. Archived from the original on August 3, 2020.
  18. "China sanctions 11 US politicians, including Cruz and Rubio, and heads of pro-democracy organizations". The Associated Press. August 10, 2020. Archived from the original on August 15, 2020 – via USAToday.
  19. "'Mandating China label like forcing HK firms to lie'". Radio Television Hong Kong. August 13, 2020. Archived from the original on December 10, 2020.
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