China’s liaison office in Hong Kong owns more than 700 properties in the city, according to a pro-democracy lawmaker and activism group.

Political group Demosisto and legislator Eddie Chu on Monday released the study titled “Report on Liaison Office’s Property Empire in Hong Kong,” which detailed properties owned by the Beijing representative based on public information.

Eddie Chu, Nathan Law, Joshua Wong. Photo: Rachel Wong/HKFP.

According to the report, the liaison office and its affiliated businesses, including Newman Investment Company Limited, owned at least 757 property units in Hong Kong, among which were 722 residential units purchased since 1981, valued at more than HK$3.3 billion as of last February. Other properties included 12 offices, 10 entire buildings and eight commercial units.

The findings revealed the Happy Valley Post Office, operated by the Hong Kong government, is currently using a unit leased by Newman Investment to the Financial Secretary Incorporated, valued at HK$140,000 per month.

The former DAB Southern District branch and three other pro-Beijing political organisations have used offices owned by the liaison office and its affiliated business for organising election campaigns and demonstrations, the report said.

The Financial Services and the Treasury Bureau said the liaison office owned 78 properties in Hong Kong, according to a reply to a lawmaker quoted in the report.

But Demosisto questioned the accuracy of the government figures, saying that the office had purchased around 137 properties from 2015 to February this year.

Happy Valley Post Office. Photo: Wikicommons.

The report also estimated that the properties were exempted from HK$124 million in stamp duty over the past five years. It added that a lack of transparency in the operations of the liaison office, as well as vague definitions of the corporations affiliated or directly under Beijing authority, may lead to abuse of regulations.

Chief Executive Carrie Lam on Tuesday pushed back against the report, saying that under the law, properties purchased by the liaison office are exempted from stamp duty: “I suspect before 1997, it is equally applicable to the UK government.”

“That’s a legal position and that legal position has been explained previously in [the] Legislative Council. So there is nothing new. This also indicates that we do have people who want to rouse public controversy by digging out old issues and try to rehash them again.”

Joshua Wong. Photo: Rachel Wong/HKFP.

Demosisto Secretary-General Joshua Wong said he hoped the report would emphasise Beijing’s tightening grip on Hong Kong: “To keep watch on liaison office’s control, Demosisto has examined liaison office’s property portfolio and estimated the size of China’s Liaison Office stationed in Hong Kong.”

“Most of these residential units are two-room flats, which means they can accommodate up to 1,400 staff members. In comparison, the government headquarters only house 3,200 staff members… [the liaison office] scale gives the impression of a shadow government.”

Beijing’s encroachment

Demosisto said it would submit the report to the UK All-Party Parliamentary Group on Hong Kong, the US Congressional-Executive Commission on China, and the US State Department, which will soon release a report on Hong Kong’s autonomy in accordance to US-Hong Kong Policy Act.

“When they evaluate… the manipulation and interference of Beijing [into] Hong Kong, the scale and the operation of… China’s Liasion Office must be one of the critical and important topics [that] should be mentioned in the report,” Wong said.

Photo: Kris Cheng/HKFP.

Demosisto cited a government response to lawmaker Fernando Cheung in 2018 as saying the Immigration Department did not keep statistics on work permits issued to personnel sent to work in Hong Kong-based Chinese government departments.

Wong pointed to recent controversies over the role of the liaison office, with the Hong Kong government stating the representative fell outside of the scope of Article 22 of the Basic Law, which bars Beijing from interfering in the city’s affairs.

Asked by HKFP whether Demosisto believes the government has failed to oversee all properties owned by the liaison office and its subsidiaries, former chair Nathan Law said there was definitive proof of the Hong Kong government’s lack of autonomy.

“But the most important thing is the Hong Kong government definitely [possesses] those cases of exemption of taxes, and I think [this] information should be transparent and there should be checks and balances and mechanisms to ensure that these exemptions [are applied] the right way,” he added.

Nathan Law. Photo: inmediahk.net.

Law wrote on Facebook on Tuesday evening that the group used on-site investigations and online registries to compile the report.

He said potential risks discouraged researchers from attending the press conference: “It is fear… researchers avoid showing their faces because the scale of the liaison office is considered to carry high political risks.”

Law added the office’s property purchases increased in number and distance to Kowloon and the New Territories after 2015: “They clearly are not playing the role of a bridge between [the Hong Kong people] and the Chinese government.”