Secretary of State Mike Pompeo said he had certified on Wednesday to Congress that Hong Kong no longer warranted special treatment under U.S. law in the same way that applied when the territory was still under British law before July 1997.
In a statement, Pompeo said China's plan to impose new national security legislation on Hong Kong was "only the latest in a series of actions that fundamentally undermine Hong Kong's autonomy and freedoms."
"No reasonable person can assert today that Hong Kong maintains a high degree of autonomy from China, given facts on the ground," he said.
"After careful study of developments over the reporting period, I certified to Congress today that Hong Kong does not continue to warrant treatment under United States laws in the same manner as U.S. laws were applied to Hong Kong before July 1997," Pompeo said.
"It is now clear that China is modeling Hong Kong after itself," he added.
The "Hong Kong Human Rights and Democracy Act" approved by the U.S. Congress and President Donald Trump last year requires the State Department to certify at least annually that the former British colony retains enough autonomy to justify the favorable U.S. trading terms that have helped it maintain its position as a world financial center.
Under it, officials responsible for human rights violations in Hong Kong could be subject to sanctions, including visa bans and asset freezes.
It now falls to Trump to decide to end some, all or none of the economic privileges Hong Kong currently enjoys.
Trump said on Tuesday the United States was working on a strong response to China's planned national security legislation for Hong Kong and it would be announced before the end of the week.
