Foreign firms in HK seek legal advice in wake of security law

Many update contingency plans to counter any risks linked to state secrets provisions

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Vague provisions in Hong Kong's new national security law around state secrets and links to foreign entities have put on edge many global businesses in the financial hub, with some consultants and hedge funds updating contingency plans and seeking legal advice in a bid to counter this political risk.

Several corporations, worried about data security, are now treating Hong Kong, once a major Asian base for multinationals, in the same way as mainland China and shielding information about the rest of the company from teams there, said an executive with decades of experience as an adviser to international firms.

Another executive said his hedge fund was seeking legal advice on how to deal with regulators and other government officials because of the state secrets provisions.

"It boils down to a lack of trust in the Hong Kong government that is beholden to China," said a foreign executive who attended a recent meeting with senior Hong Kong officials.

The three executives, like the more than a dozen businessmen Reuters spoke to, declined to be identified due to the sensitivity around security issues.