How China’s Great Firewall Could Encircle Hong Kong

(Bloomberg) -- Hong Kong’s internet users worry that the new national security law imposed on the city by the Chinese government will end up cutting off the free flow of information, landing them on the dark side of China’s Great Firewall. One social media company has pulled out, others are considering how far they can push back against the law’s provisions and keep doing business. For the former British colony, how Big Tech reacts to the law could have a much wider impact on its future as a global financial hub.

1. How does the law affect the internet?

Under the implementation guidance, police can ask technology and telecommunications companies -- be they platforms like Facebook Inc. or Twitter Inc., website hosts like GoDaddy Inc. or internet service providers -- to delete or restrict access to certain messages that authorities deem may endanger national security. The companies have limited options to resist those requests, such as when technology necessary for compliance isn’t immediately available. Otherwise, should a company fail to cooperate immediately, the police may apply for a warrant “to seize the relevant electronic device and take any action for removing that information.”

2. What are the penalties?

Non-compliance could result in a fine of HK$100,000 (around $13,000) and six months in prison for companies involved in publishing messages that are considered a threat. It’s unclear exactly who at the company would be held liable. For individuals who post offending messages, the fine is the same but the jail term is one year. Separately, the rules state that for the purpose of assisting an investigation, Hong Kong’s justice secretary or police may apply for a court order to require people to answer questions within a specified time period, or to furnish or produce the relevant information or material.

3. How worrisome is it?

A problem with the law is its ambiguity: It’s unclear what types of actions will be considered violations. Since it took effect July 1, police for example have arrested a man for brandishing a Hong Kong independence flag and declared illegal a popular slogan chanted by pro-democracy protesters over months of rallies. For internet users, the concern is that their personal information -- including such things as their contact lists, private posts or messages -- could be shared with authorities, possibly implicating them under the law.

4. What are the risks for Big Tech?

The law presents the likes of Facebook and Alphabet Inc.’s Google with a stark dilemma: Bend to the law and risk becoming an accessory to a crackdown on freedoms in Hong Kong at a time when U.S.-China relations are increasingly strained, or simply refuse to comply and depart Hong Kong, much like Google did from China a decade ago for similar reasons. Some social media giants are already facing mounting criticism in their home markets for their role in hate speech and disinformation, and Facebook and others certainly won’t want to expose their reputations to further harm. The law also poses a threat to tech company employees in Hong Kong and abroad, who face possible arrest and prosecution for perceived violations.

5. Is this like the internet in China?

Not really, or not yet anyway. Behind the Great Firewall, China’s online population of 800 million gets a highly restricted internet, one that doesn’t include access to Google, Facebook, YouTube or Western media such as the New York Times. There’s little coverage of the 1989 student protests in Tiananmen Square, for example. Even Winnie the Pooh got temporarily banned when social media users compared him to President Xi Jinping. China is able to control such a vast ocean of content through the largest system of censorship in the world. It’s a joint effort between government monitors and the technology and telecommunications companies compelled to enforce the state’s rules. The stakes go beyond China, which is setting an example that other countries can imitate.

6. What’s the response been in Hong Kong?

Hours after Hong Kong announced the new powers, Facebook, Google, Twitter, Microsoft Corp. and Zoom Video Communications Inc. all suspended processing requests for data from the Hong Kong government while they review the law. TikTok, the viral video app from Chinese-owned ByteDance Ltd., went even further by withdrawing its service from the territory’s mobile app stores “in light of recent events.” In the city, some people have already deleted their social media accounts. Virtual private networks, or VPNs, designed to disguise a user’s digital footprints, also saw a big spike in downloads. The messaging service Signal, which deliberately collects no data on its users and encrypts their communications, became the most-downloaded app in Hong Kong after the law was imposed.

7. Is Hong Kong going to lose Facebook and Google?

Much depends on the speed and aggressiveness with which the new law is applied. It’s possible that Big Tech could decide that complying is simply not worth it in terms of political and legal risks to the company as well as to its customers and employees. If Beijing takes a slower approach to putting the law into action, U.S. firms might try to hang in there for as long as they can. “While changes to how the internet operates in Hong Kong are likely to proceed slowly, some services could indeed be blocked at some point, particularly those that are perceived by the Chinese government to have facilitated protests,” said Ian Betts, director of risk intelligence with consulting firm Hill & Associates.

The Reference Shelf

• A QuickTake on the new laws China has passed for Hong Kong, and how the China model of governing works.
• Official implementation rules for the national security law for Hong Kong.
• Antony Dapiran for Bloomberg Opinion on how doing business is likely to get harder in Hong Kong.
• New York Times columnist Ben Smith on how autocrats around the world are cracking down on digital news sites.

©2020 Bloomberg L.P.

With assistance from Bloomberg