Multiple Hong Kong Companies Allegedly Helping Russia, Iran, and North Korea Evade Sanctions.

Hong Kong plays a leading role in facilitating the transfer of funds and restricted technologies to Russia, Iran, and North Korea, as stated in a report released by the Committee on Free Hong Kong (CFHK) Foundation on July 22. Meanwhile, Ukrainian Foreign Minister Kuleba visited Hong Kong on the 25th, meeting with Chief Executive Carrie Lam, urging the Hong Kong government to take measures to prevent Russian companies from using Hong Kong to evade international sanctions.

According to information from October 2022 provided in response to media inquiries, the Hong Kong government stated that Hong Kong has been fully implementing United Nations Security Council sanctions, although it does not have the authority to enforce unilateral sanctions imposed by other jurisdictions. A sanctioned Russian billionaire’s yacht visited Hong Kong while these statements were made. The report alleges that the Hong Kong government’s stance is to provide a “green light” for sanctions evaders, including Russian oil tanker owners and exporters of drone technology to Iran.

Titled “Beneath the Harbor: Hong Kong’s Leading Role in Sanctions Evasion,” the report analyzed data collected by C4ADS, a global security nonprofit based in Washington, DC, including public data, corporate records, and other open-source data. It found that semiconductor exports from Hong Kong to Russia doubled to $400 million in February 2022 following Russia’s invasion of Ukraine.

Furthermore, from August to December 2022, Hong Kong companies shipped nearly $2 billion worth of goods to Russia, with $750 million falling under the “Common High Priority Items List” of the U.S. and EU, such as high-tech products aiding in warfare like computer memory chips and controllers. In 2023, 46% of Hong Kong’s total shipments to Russia consisted of items from this list.

The report identified 18 companies, most of which have addresses in Hong Kong located in areas like Central, Wan Chai, and Cheung Sha Wan. However, some companies have publicly registered addresses in Moscow and Norway.

One of the companies mentioned was “Corp-Link International Logistics Ltd,” which was found to have vacated its premises in Tsuen Wan. Established in 2009, Corp-Link ranked ninth as a shipper of goods on the “List” in December of the previous year, with 75.6% of its shipments falling under the listed items. The company was identified as a shipper to five Russian companies, including the sanctioned Global Key company based in St. Petersburg.

Another company, “Piraclinos Limited,” which claimed to be a charcoal and fertilizer trader, was discovered to be shipping semiconductors from major U.S. tech manufacturers to the sanctioned Russian company, VMK. The report highlighted discrepancies indicating possible efforts to conceal the actual contents of the shipments.

C4ADS also collected data from Russian customs records in 2022 and 2023, indicating that Piraclinos shipped mostly integrated circuits to Russia without evidence of arrangements for charcoal or fertilizer transport.

The report noted that the true operators behind Piraclinos remain unclear, possibly involving a shell company or connections with VMK. The company appeared to deliberately obscure its ownership and operations.

In addition to Russia, two Hong Kong-registered companies, HK Shipping Cooperation Limited (HKSC) and HK Petroleum Enterprises Cooperation Limited (PECL), were implicated in facilitating the transfer of oil for the Iranian military. Both companies, established in 2021, shared shareholders, directors, company secretaries, and registered offices.

In February, a hacker group named PRANA Network claimed successful network intrusion into a company associated with the Iranian Revolutionary Guard known as Sahara Thunder, showing past transactions with the aforementioned companies.

According to emails from Sahara Thunder, discussions with HKSC involved details of ship-to-ship oil transfers, with reference to vessels having a “clean flag,” indicating vessels not subject to sanctions or restrictions. The emails detailed a transaction planned for December 9-11, 2022, in Iraq, excluding Iran, with a delivery location in Malaysia or secure ports in China.

Moreover, agreements outlined in attach…