China introduces new asset-freezing anti-terror law

[xhw1986]

China's central bank has announced new regulations that enable authorities to freeze assets of domestic terrorist groups and their "overseas affiliates" as part of continued efforts to fight rising terrorist activities in the country.

The new measures, jointly issued by the People's Bank of China, the Ministry of Public Security and the Ministry of State Security, was announced on Jan. 17 and comes into effect immediately, according to a release from China's official Xinhua news agency.

The central bank said the rules "will prevent terrorism and is in accordance with a United Nations requirement that all nations freeze, without delay, funds or other assets of terrorists." It is the first anti-terrorism law to be passed in China since the National People's Congress issued a directive in 2011 that required "financial and certain non-financial organisations" to take steps to freeze funds seen as being directed towards terrorist activities.

The new law features 22 rules, including requiring that all financial institutions report to the central bank if they have "reasonable suspicion" that customers or transactions could be related to terrorism. The assets of people named on government lists as belonging to terrorist groups, or being involved in terrorist activities, must also be frozen, with the banks keeping a close eye on all transactions.

Financial institutions, specific non-financial instititions and their staff are also required to fully cooperate with authorities in investigations into terrorist activities, including providing all necessary information requested. They are also prohibited from tipping off customers that their accounts or assets are about to be frozen, with infringers subject to punishment.

The central bank said the new regulation "mainly applies at home, but also has effects on overseas branches and affiliates of relevant organisations."

Analysts say the new measures are not surprising given the added pressure on the government following a spate of terrorist attacks in recent years, the majority of which are linked to suppressed minority groups in regions such as Xinjiang and Tibet. At least 91 people, including police officers, have been killed in violence in northwest China's Xinjiang Uyghur autonomous region since last April, according to state media. Last October, a jeep carrying passengers identified by authorities as Xinjiang terrorists plowed into crowds near Beijing's iconic Tiananmen Square before catching fire, killing five and injuring another 40.

Billy Mak, an associate professor at Hong Kong Baptist University, told South China Morning Post that asking banks to freeze funds linked to terrorist activities is an international practice that is also followed by Hong Kong. Banks have every right to stop and even report suspicious large transactions, he said.