Taiwan blocks Hong Kong immigrants over KPMG China and Cathay Pacific links

Taiwan authorities have cited working for the China arm of Big Four audit firm KPMG and for airline Cathay Pacific as reasons to reject immigration applications from Hong Kong residents, amid a tightening of controls prompted by national security concerns.

Immigration consultants said Taiwan’s national security agency stepped up vetting of Hong Kong residents’ applications to live in the country following a surge of applications prompted by the Chinese territory’s suppression of pro-democracy protests in 2019.

China, which claims Taiwan as its territory, has threatened to take it by force if Taipei resists unification indefinitely and has increased military activity around the island in recent years.

Appeal decisions for Taiwan residency applications over the past year revealed multiple instances of Hong Kong residents being rejected because of current or former employers, including financial institutions with mainland Chinese investors such as tech group Alibaba.

“Many Hong Kongers hoped to move to Taiwan after 2019 due to national security [controls] in Hong Kong, but now Taiwan is rejecting them for national security reasons,” said Shirley Cheung of consultancy Formosa Immigration, which has offices in Hong Kong and Taipei.

One Hong Konger, a former employee of KPMG in Hong Kong who applied for Taiwan residency as a skilled migrant, was rejected in July over national security concerns.

Taiwanese officials described KPMG China as an entity that served “mainly mainland Chinese people” and was perceived to have a “strong mainland Chinese” component. The officials also cited the applicant’s current role as legal counsel for Hong Kong fintech company WeLab, which counts Alibaba among its investors, as a reason for the rejection.

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Last month, Taiwanese officials also cited national security considerations in upholding the rejection of an application for permanent residency as an investment immigrant by a person who worked for Cathay Pacific’s catering services arm in the 1990s.

The officials wrote in appeal rulings published online by the government that Cathay Pacific’s major shareholders included state-owned Air China. The applicant’s personal investments in Taiwan were also “problematic”, they added.

Former and current employees at Chinese state banks, investment group CLSA, and at Hong Kong-listed telecommunications company PCCW — controlled by local billionaire Richard Li — also had residency appeals rejected over similar issues.

WeLab said the company was “founded and headquartered in Hong Kong with multiple fintech businesses across Asia”. KPMG China, Cathay Pacific, CLSA and PCCW did not immediately respond for comment.

Taiwan has tightened screening of investment from Hong Kong in recent years after Chinese-controlled companies and Chinese individual investors used Hong Kong companies or personal identities to circumvent bans and checks applied to investment from China.

Taiwan also subjects residency applications from Hong Kongers to a security review. Applicants are often rejected if they were born on the Chinese mainland or worked for government institutions, the Communist party, military or other entities with mainland links.

Taiwan’s cabinet-level China policy body, the Mainland Affairs Council, said some immigration officials had handled some cases with “excessive” national security concerns, but that this was no longer happening.

“While such links raise the level of the review to ensure there is no risk to our national security, those links themselves will never be the reason for having your application denied,” said Chiu Chui-cheng, MAC deputy minister. “We hope that some failed individual cases will not discredit our efforts to help Hong Kongers who want to come and live in Taiwan.”

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The Taiwanese government said the main reason for rejecting Hong Kongers’ residency requests was fraudulent applications for immigration through investment that were filed with the help of consultants.

The number of Hong Kongers permitted to reside or permanently settle in Taiwan jumped nearly 70 per cent to 12,389 in 2020. The number of permits increased to another historic high of 12,858 in 2021.