US and UK lawmakers accuse HSBC of harassing Hong Kong residents over pensions

Get Free HSBC Holdings plc Updates

we will send you one myFT Daily Digest Latest Email Rounding HSBC Holdings plc News every morning.

Two influential supporters of China in the US Congress and the UK Parliament have accused HSBC of oppressing Hong Kongers over pension rights if they choose to emigrate, a sign of pressure on the bank as it Spread across Western and Asian markets.

Mike Gallagher, a US Republican representative and chairman of the House China Committee, and Alicia Kearns, a Conservative lawmaker who heads the UK’s foreign affairs select committee, wrote to HSBC on Friday expressing “deep concern” that the bank was foreclosing parts of Hong Kong. Residents should not make early pension withdrawals if they want to go abroad.

They wrote to HSBC chief executive Noel, “We are concerned that HSBC – in support of the Hong Kong National Security Law – is withholding pension funds from BNO (British National Overseas) passport holders and thereby contributing to the oppression of people in Hong Kong.” Is.” Quinn, in a letter obtained by the Financial Times.

The pressure from lawmakers highlights how increasingly geopolitical tensions are making it difficult for HSBC to operate from twin bases in Hong Kong and the west. The bank exited US retail banking two years ago but relies on the US for its dollar-clearing licence, which is essential for its vast global trade financing business.

Following pro-democracy protests in Hong Kong in 2019 that led authorities to crack down on political expression, Britain launched a visa scheme that provides a path to citizenship for the city’s 5.4 million residents who hold British National Overseas documents are or are eligible for it. Migration routes in the form of family members.

Beijing responded by saying that it would not recognize the BNO papers as official documents. The Hong Kong government had then said that residents availing of the BNO visa scheme cannot apply for early withdrawal from the territory’s compulsory retirement scheme, the Compulsory Provident Fund (MPF).

Hong Kong residents can generally make early withdrawals from the scheme if they make a “permanent departure” to settle elsewhere, or in the event of early retirement or serious illness.

“In the case of permanent departure, scheme members are required to provide proof of their right of abode outside Hong Kong,” HSBC said. “(The regulator) has published guidance on what evidence members of the scheme can rely on and, like all banks, we have to comply with the law and the instructions of the regulators.”

HSBC is one of a group of eligible financial institutions, including Manulife and Invesco, that offer pension funds under the MPF Retirement Savings System.

The Hong Kong Authority, which runs the MPF scheme, said BNOs are not considered valid travel documents and should not be used as evidence for early withdrawal of pension funds. A spokesman said the trustees “have a duty to abide by Hong Kong laws”.

Beijing imposed a controversial national security law on Hong Kong in 2020, prompting thousands of residents to leave for destinations including the UK, Canada, Australia and Taiwan.

In the UK, more than 90 MPs, including former ministers, signed a letter last month urging Business Minister Dominic Johnson to pressure trustees including HSBC to give Hong Kong residents in the UK access to their pension savings Allow

Hong Kong has frozen pensions worth an estimated £2.2 billion for some 96,000 people who have moved to the UK in 2021 and 2022, according to advocacy group Hong Kong Watch. According to government data, around 30,000 people going abroad have applied for expedited clearance every year since 2020.

In Friday’s letter, the lawmakers noted that the US passed legislation in 2020 allowing Washington to impose sanctions on individuals who contributed to the actions that resulted in Beijing failing to meet its commitments under the 1984 Sino-British Joint Declaration. failed to do, which had set the conditions. Hong Kong’s return to Chinese administration in 1997.

Lawmakers said the national security law violated both the 1984 declaration and Hong Kong’s mini-constitution, known as the Basic Law.

Gallagher and Kearns asked HSBC to provide information on who authorized the decision not to recognize the BNO passport and whether board members were aware of it.

He also asked whether HSBC has approached China’s foreign ministry or Hong Kong’s government about security legislation and restrictions on the use of BNO documents to apply for pension withdrawals.