The US has issued a warning to firms over the risks of doing business in Hong Kong after China imposed a new national security law there last year.
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 on Thursday that “the situation in Hong Kong is deteriorating”.
Ahead of the business advisory being issued by the departments of State, Treasury, Commerce and Homeland Security, the president warned: “The Chinese government is not keeping its commitment that it made, how it would deal with Hong Kong”.
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. It makes it easier to punish protesters and reduces the city’s autonomy.
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, told the BBC: “I think this is quite serious.
“I think it’s a reflection of the dramatic changes that have gone on in Hong Kong.”
He pointed out that hundreds of American companies have a presence 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.
