Five special rapporteurs of the United Nations issued a joint communication on 25 July 2023 to express their concerns over Hong Kong’s proposed legislation on the regulation of crowdfunding activities, highlighting that the proposed legislation may result in the violation of certain fundamental rights and freedoms under international law. The five independent experts also criticized that the proposed crowdfunding application and registration procedures may not meet the required thresholds of necessity, proportionality, and non-discrimination under international law.
Hong Kong Centre for Human Rights finds that this joint communication reflects the UN human rights experts’ concern that the Hong Kong government is actively using legislative and administrative measures to stifle the civil society in Hong Kong; the analysis also reveals the purpose of such measures to be decapacitating civil society in Hong Kong. We urge the Hong Kong government to withdraw this legislative proposal immediately, and to review existing legislation for the purpose of creating and maintaining an enabling environment for the enjoyment of civil society organizations’ right to seek, receive and use resources.
The experts have made a number of critical observations of the proposed legislation. They stated that the proposed law gives expansive discretion to the government without any clear limiting safeguards, and that an absence of clear definition of terms such as “national security” could potentially lead to overly broad or arbitrary interpretations or applications.
They also pointed out that the proposed requirement to apply to the government prior to performing crowdfunding activities may be overly burdensome and disproportionate to the stated objectives with potentially detrimental impacts on civic space. They further stated that the application process may inhibit associations’ functional autonomy and operation. Moreover, the applicability of the proposed application process to all crowdfunding activities by people in Hong Kong, regardless of whether the actual activity is conducted there, may also raise extraterritorial jurisdictional issues.
The communication noted that the requirement for crowdfunding activities over a certain amount to be limited to “real name” contributors and to be subject to auditing may have further chilling effects. In response to the proposed requirement for crowdfunding platforms to designate a local representative in Hong Kong, the experts worried that this may significantly limit the availability of crowdfunding platforms because many providers without an existing physical presence in Hong Kong may simply opt out of registering with the government in the first place.
This joint communication was issued to the Chinese government by five human rights experts, namely the Special Rapporteur on the promotion and protection of human rights and fundamental freedoms while countering terrorism, the Special Rapporteur on the promotion and protection of the right to freedom of opinion and expression, the Special Rapporteur on the rights to freedom of peaceful assembly and of association, the Special Rapporteur on the situation of human rights defenders, and the Special Rapporteur on the right to privacy.
The Hong Kong government issued a legislative proposal in December 2022 seeking to introduce tighter regulations of crowdfunding activities, with a public consultation having ended on 20 March 2023. No definite timeline of the legislative process has been announced yet.