A day after American video sharing site YouTube cancelled John Lee Ka-chiu’s campaign channel citing compliance with sanction laws, uncertainty has emerged over whether the sweeping legislation will curb the chief executive candidate’s ability to raise funds.

Lee was among 11 Beijing and Hong Kong officials sanctioned by Washington in August 2020 over what it decried as their role to “undermine Hong Kong’s autonomy and restrict the freedom of expression or assembly of the citizens of Hong Kong” after the imposition of the national security law.

Lawyers who spoke to the Post said the restriction slapped on the then-security minister could prove to be an impediment now that he was raising funds for his leadership bid as the sole Hong Kong candidate endorsed by Beijing.

Chief Executive Carrie Lam revealed in 2020 she was being paid her salary in cash because she was on the US sanctions list.

For a start, they said, a predicament could arise when donors contributing to Lee’s campaign were American citizens, or wired money, especially US dollars, through a United States bank.

Even if the contributor was not a US citizen or was transferring money through a bank that had no presence in America, the person could still be targeted by the US government, one lawyer argued.

“The US government could potentially go after the person, or they could go after the financial institutions that are supporting the campaign contributions,” said the specialist in sanctions law, who spoke on condition of anonymity citing the sensitivity of the issue in the city.

Another legal scholar, Professor Surya Deva, who specialises in business and public law at the Macquarie Law School in Sydney, suggested that the likelihood of the US government going the extra mile to target non-US individuals and entities would be slim, given the less immediate linkage.

Deva doubted there would be “any consequences for now” for Lee’s campaign team members or donors, though he warned: “The US government may later add more people to the sanction list if it felt so, based on their record in undermining Hong Kong’s autonomy.”

On Wednesday, YouTube, which is owned by American tech giant Alphabet, the parent company of Google, terminated the channel Lee had been using to broadcast his meetings with different sectors since announcing his leadership bid on April 9.

“Google complies with applicable US sanctions laws and enforces related policies under its terms of service. After review and consistent with these policies, we terminated the Johnlee2022 YouTube channel,” a Google spokesman has told the Post.

The sanctions imposed by the US Treasury Department in August 2020 – a little more than a month after Beijing imposed the sweeping national security law on Hong Kong – hit Lee with a host of economic restrictions, while clipping the ability of US citizens and financial institutions to deal with him.

In the previous chief executive election, current leader Carrie Lam Cheng Yuet-ngor, received HK$18.7 million in election donations from business leaders, who also mobilised family members and staff to bankroll her campaign.

Among others, donors to Lam’s campaign included family members of Henderson Land, senior employees at Cheung Kong Property Holdings and bosses of Hopewell Holdings.

It is known that several of the city’s most influential residents hold US passports.

Responding to the Post’s queries on who will be funding Lee, and whether the sanctions in place would cause concerns, his campaign office pointed to the rules and procedures set out by the Registration and Electoral Office (REO), the local department tasked with providing administrative support for the poll.

The office’s spokesman said it was “guided by these rules and any guidance given by the REO on questions arising in the course of the campaign”.

“Information regarding funds raised for the campaign will be submitted to the REO and is accessible by members of the public in due course,” it added.

The donors list is often released a month after the election.

Explaining how the US penalties work, lawyer Ben Kostrzewa, a US sanction specialist from Hogan Lovells, said it came in two tiers: primary and secondary.

He said primary sanctions applied when there was a “US element” involved, such as a US citizen, a transaction completed in American currency and deals going through a US financial institution or server.

A breach could attract a fine of US$330,947, according to the latest inflation adjustment.

“Secondary sanction is more complicated,” he explained, referring to scenarios where there were no US factors involved.

Kostrzewa said the US government might still decide to penalise a non-US person or entity when there was a “significant transaction” or “material support” involved by making them a sanctioned individual.

“The risk is whether or not the US government would determine that transaction to be either significant or material support,” he said.

Deva, from the Macquarie Law School, said precisely because donors were not yet part of the sanction list, it was unlikely they could cause problems for Lee’s fundraising efforts.

“However, this would mean some complications in lodging expenses reports as part of election return,” he said, referring to how their declarations could be evidence for the US to act upon.

Hong Kong veteran lawyer Ronny Tong Ka-wah, who is also an adviser to the government’s advisory Executive Council, stressed the sanctions were limited strictly to US citizens and organisations, although he was uncertain about the consequences others might face if they went to the US.

Entertainment tycoon Allan Zeman said the “hard truth” was that Lam had also been hit with the penalties, and yet it had never affected the government’s ability to raise funds. “There is no reason John should be any different from Carrie Lam,” he said.

In late 2020, Lam revealed she was being paid her entire salary as chief executive in cash because she was on the sanctions list. It is believed Lee was also paid in cash during his tenure as the city’s No 2 official.

One scenario could be donors giving their funds in cash to the candidate. But Zeman, a member of Lee’s presidium or advisory team, added the chances of Lee tapping a US citizen for funds would be highly unlikely given many other alternatives were available.

“There is a world outside of the United States,” he said.