One Country, Two Systems in Practice : Reviews, Analysis and Proposals

Kay Lam
One Country Two Systems

The Root of the Conflicts in One Country, Two Systems

Since the establishment of the Hong Kong Special Administrative Region (HKSAR), the city has seen steady and continuous progress in various aspects, including economic, social and political systems and the setting up of external connections. Although the society has yet to reach consensus on important political questions such as universal suffrage and the enactment of laws required for the implementation of Article 23 of the Basic Law, and although difficulties have often held back the process of governance, it is certainly the case that Hong Kong society has generally remained prosperous and stable. Since the changeover, Hong Kong has taken full advantage of the benefits of One Country and the convenience of Two Systems, and played a unique role in the overall development of the country. Hong Kong has contributed to the Mainland’s reform and opening-up as well as regional development, while improving and upgrading its own economic structure. Generally speaking, One Country, Two Systems (OCTS) has been successful. As practice has proved, OCTS is the best model for the whole country and HKSAR.

Despite this general success, the implementation of OCTS has encountered difficulties. In particular, new circumstances emerged to rock the confidence of some Hong Kong people in OCTS. Many feel dissatisfied and frustrated because their quest for an ideal political system has been unsuccessful. Some young people even think of abandoning OCTS in pursuit of their ideals. The Central People’s Government (CPG)’s modification of its Hong Kong strategy in response to these new circumstances also made some Hong Kong citizens feel that the CPG has lost patience with Hong Kong people, or have run out of confidence for OCTS

These doubts over OCTS originate from the intrinsic contradictions or the nature of the system, as well as the differences in point of view and way of thinking between Hong Kong people and the CPG, often with mutual misinterpretation during the exchange of messages. 

In such context, this report identifies three research objectives. First, it focuses on Hong Kong people’s doubts about the constitutional arrangement of the HKSAR and tries to clarify several important constitutional and legal concepts. These include the applicability of the Constitution of the People's Republic of China (PRC Constitution)  in Hong Kong, the relationship between the PRC Constitution and the Basic Law and the legal rationale of CPG’s “overall jurisdiction” and its relation to HKSAR’s “high degree of autonomy”. Second, by examining the actual interaction between the CPG and Hong Kong citizens after the changeover, this report reviews the achievements of OCTS as well as problems arising from its implementation. Third, it attempts to analyse the issues and propose reasonable and feasible ways of improvement. 

Research Questions and Main Chapters

This report takes two questions of concern to the general public as its key entry point: 

(1) Why did CPG introduce the term “overall jurisdiction” in recent years and at the same time emphasise the equal importance of PRC Constitution and the Basic Law for the implementation of OCTS

(2) How should we evaluate OCTS objectively? Has this policy, as some would consider, lost its value or become “defenceless” in the face of “violation”? 

Behind the first question are plenty of political analyses and discussions related to legal studies. Such terms as “overall jurisdiction” and “constitutional responsibility” have caused concern, not only because CPG has not put forward explicit legal arguments, but also because the concepts appear to depend on the Beijing leadership’s principles of governance and their assessment of Hong Kong’s political situation. This report will analyse, from both legal-constitutional and political perspectives, the formulation of and the reasons for changes in CPG’s strategy towards Hong Kong. 

In respect of the second question, this report reviews the drafting records of the Basic Law and the related discussions to show the spirit and values behind the institutional design of HKSAR. Through re-examining and reflecting on Hong Kong’s existing strengths and potential weaknesses, it will also explore the conditions and room for the further development of OCTS.

The above issues and relevant analyses are incorporated into the discussions in the next six chapters:

Chapter 1   The relationship between the PRC Constitution and the Basic Law

Chapter 2   CPG’s powers and HKSAR’s high degree of autonomy

Chapter 3   The importance of One Country, Two Systems and the indicators for 
                   its success

Chapter 4   The conflicts and difficulties in the implementation of One Country, 
                  Two Systems

Chapter 5   Conclusion

Chapter 6   Suggestions for improvements in the implementation of One Country, 
                  Two Systems

Four Recommedations for Improving the Implementation of One Country, Two Systems

Our investigation shows that political reform and the enactment of laws in respect to Article 23 of the Basic Law are the primary political issues that must be addressed in the implementation of OCTS. The CPG and HKSAR have not been able to resolve these problems in a concerted manner, because the two sides may differ in their understanding and interpretation of the constitutional arrangement. In addition, there has been insufficient discussion within HKSAR on how to appropriately utilise OCTS and the Basic Law to deal with current problems and address future challenges. This has led to negative assessment of OCTS, with its proven achievements and workability being neglected. We therefore put forward four main suggestions to develop some room for discussion:

Recommendation 1: Clarify PRC Constitution’s applicability in Hong Kong and the fundamental rights and duties of Hong Kong Permanent Residents who are Chinese citizens

Among the totality of Hong Kong Permanent Residents (HKPR), many are Chinese citizens at the same time, and enjoy extra rights as provided in the Basic Law. As the CPG increasingly emphasises PRC Constitution and Basic Law education and HKSAR’s duties to the country, it has become necessary to clarify whether these HKPR-Chinese citizens, in possession of extra rights, should also assume more duties (like those set out in PRC Constitution) towards China. 

We are of the opinion that, be it from the perspective of international public law or that of constitutional law, PRC Constitution’s validity for Hong Kong is full and complete. However, in the setting of OCTS, PRC Constitution performs its functions in HKSAR mainly through the Basic Law. As a special or exceptional arrangement in the national system, the Basic Law has priority in application, so that provisions in PRC Constitution conflicting with the Basic Law are not directly applicable to Hong Kong. Based on this principle, we have taken a close look at the provisions of “Chapter II The Fundamental Rights and Duties of Citizens” of the PRC Constitution, and arrived at the following suggestions: 

Rights present in both PRC Constitution and the Basic Law (such as right to elect and be elected, freedom of religion and right to personal liberty) should take the Basic Law as their legal basis. 

Those provisions in Chapter II of PRC Constitution which are explicitly related to socialist system and policies are not applicable to Hong Kong.

The duties of military service and tax payment, as set out in PRC Constitution, are not applicable to Hong Kong. Under the principle of OCTS and according to the Basic Law, Hong Kong residents pay taxes to HKSAR Government and not to CPG. CPG is responsible for the defence of HKSAR. The national Military Service Law of the People's Republic of China is not listed in Appendix III of the Basic Law; therefore, there is no clear legal justification for Hong Kong residents to participate in military service of the country. 

On the duty of upholding national security, PRC Constitution and the Basic Law do not appear to be in direct conflict. However, the National People’s Congress (NPC) has left it to HKSAR to legislate on its own to protect national security (Basic Law, Article 23). The fulfilment of this constitutional responsibility consists of the enactment of laws in accordance with Article 23. If it is considered that HKPR-Chinese citizens, apart from abiding by laws as stipulated in the Basic Law, should have other duties in relation to upholding national security (for example, have a more complete sense of national identity and concept of national security, or uphold PRC Constitution more consciously), such duties can be understood as moral obligations, and should be promoted and passed down through channels like education.

Recommendation 2: Create favourable conditions for proceeding with political reform and Article 23 legislation

To drive constitutional development further forward, HKSAR Government (HKSARG) should take a proactive attitude in taking the initiative to create an atmosphere conducive to achieving political reform as well as Article 23 legislation.

We suggest that HKSARG should place the study about the Article 23 legislation under the light of the political reform exercises, and carry out simultaneous consultation on both subjects, so as to provide more ground for negotiation and collaboration: a higher degree of democratisation may give Hong Kong people better assurance that national security laws will not be abused by the government; at the same time, with national security legislation in place, CPG may be more willing to accommodate democratic aspirations of Hong Kong people.  

To create “favourable conditions” for the simultaneous launch of the two causes, we are of the opinion that, before official public consultation is carried out, HKSARG should allow sufficient “brewing” in society and let different sectors reach a basic consensus on the principles of both Article 23 legislation and political reform. This task should be initiated by a commission of a large scale; it should comprise representatives of all stakeholders, including HKSARG, the legal, business, labour, political, professional and academic sectors, and civil society organisations. These representatives will be responsible for coordinating communication between government officials and their own sectors. Having a larger-scale commission to process questions of principles could ensure that the consensus thus reached would have a broad support base. In addition to fostering the formation of society’s basic consensus on the two causes, the commission could also take up the responsibility of finding out CPG’s concerns and bottom lines for each cause. The commission should also include persons who are in constant and regular communication with CPG and are familiar with the Basic Law and the political system of HKSAR, such as the Hong Kong members of the Basic Law Committee or Hong Kong deputies to The National People's Congress (NPC). This could help the commission and the public understand CPG’s considerations and bottom lines.

Recommendation 3: Review Basic Law provisions to fit the needs of One Country, Two Systems’ development

The development of OCTS is bound to come across new circumstances and challenges. When the Basic Law was drafted some 30 years ago, the drafting committee could not have foreseen every problem that would come up in the implementation of OCTS, especially the legal issues stemming from HKSAR’s political development and its integration with the Mainland. We therefore suggest reviewing the adaptability of Basic Law provisions to the constantly developing circumstances, and proposing amendments according to actual needs, all under the premises of staying in line with the country’s established basic policy towards Hong Kong and respecting the integrity of the Basic Law.

Any amendment to the Basic Law must comply with Article 159. Besides, we suggest the following principles should be followed when any amendment motion is considered:

Principle 1: An amendment should be considered only when it is necessary and sufficient

Where changes are not necessary no amendments should be made. When there is a need for introducing an amendment to rectify a problem, it must be verified that the proposed amendment will serve the purpose adequately, otherwise it should not be made.

Principle 2: Other mechanisms of developing the Basic Law should be fully  utilised before considering amendment

According to stipulations in the Basic Law and past experience, it is not always necessary to invoke the amendment mechanism in order to effectively resolve problems arising from the implementation of OCTS. Before considering the amendment mechanism, other methods of developing the Basic Law, such as interpretation by the NPC Standing Committee and the establishment of constitutional conventions, should be fully utilised.

Principle 3: Only specific clauses should be amended as necessary

The amendment of the Basic Law takes the form of proposing and passing amendment motions. Each amendment motion should focus only on individual clauses for which the amendment is necessary, and should not make drastic changes to the Basic Law as a whole.  This makes it easier to judge whether each specific amendment is in line with the legislative intent of the Basic Law and the country’s established basic policies regarding Hong Kong.

Principle 4: Amendments should conform to the established basic policies of China regarding Hong Kong

As stipulated by Article 159 of the Basic Law, no amendment to the Law shall contravene the established basic policies of the country regarding Hong Kong, that is, the “12 Principles” stated in the Sino-British Joint Declaration. All Basic Law provisions based on these “12 Principles” cannot be amended; room for amendment may only exist as long as the amendments do not contravene the “12 Principles”. 

With the above principles in mind and having regard to actual circumstances, we suggest that the following amendments to the Basic Law should be considered: 

Regarding CPG offices in the HKSAR: We suggest introducing a new article in the Basic Law, which defines the status, functions and responsibilities of the Liaison Office of the Central People's Government in the HKSAR (LOCPG) according to the decision in the State Council’s 24th Executive Meeting (Letter No. 5 [2000]), such that the Office can discharge its duties in a legitimate and justifiable manner.

Regarding the Executive Council (Articles 54, 55 and 56): For the enhancement of HKSARG’s ability to govern, and the facilitation of constructive public discussions about political development, we suggest reorganising the Executive Council into a Government Cabinet comprising the Chief Executive, Secretaries of Departments and Directors of Bureaux. These Principal officials put forward their opinions as Cabinet members and make collective decisions, while the Cabinet takes collective responsibility for all its decisions.  

Regarding Under Secretaries (Article 48(5)): Under Secretaries acting in the positions of their Directors actually exercise the statutory powers vested in the Secretaries. Yet, they are not bound by the restriction on nationality, and need not be appointed by CPG. We suggest listing Under Secretaries as “principal officials” in the Basic Law, so that like the Secretaries, they should be HKPRs who are Chinese nationals, and be nominated by the Chief Executive and appointed by CPG. 

Recommendation 4: Leverage the strengths of One Country, Two Systems to create new values

To complement China’s advancement in environmental protection and related development trends within the country, HKSARG proactively promotes the development of Green Finance, and has seen generally positive responses from different sectors of society. The CPG, pan-democrats and local environmental groups all consider this direction beneficial to the country, to Hong Kong and to the development of environmental protection. In aspects such as finance, legal system and regulatory framework, Hong Kong’s competitive edge is truly indisputable. However, looking at the experience of Singapore, if Hong Kong aspires to become a Green Finance hub, it should not focus only on purely economic considerations or look for a foundation for development only in the economic dimension. 

For Hong Kong to perform its greatest functions in global governance and in the “Going Global” of China’s green projects, we suggest HKSARG take advantage of other strengths under OCTS, especially Hong Kong’s connections with international non-governmental organisations (INGOs). Hong Kong’s relatively lax society/organisation registration system, its economy favourable for fund-raising and its civil society environment have attracted many INGOs to stay and develop in Hong Kong. Some of them have even taken Hong Kong as their base in Asia. 

The participation of INGOs will not only enhance the knowledge of and support for green projects among the people and the business sector, but will also give Hong Kong a better chance of becoming a “Green Finance hub”. In the long-run, it can also bring Hong Kong’s success experience in policy implementation to the Mainland and international society. These functions are precisely the effects of Hong Kong’s own system, and only by maintaining the features of this system can Hong Kong preserve these strengths to benefit both Hong Kong and the Mainland.


By publishing this research, we sincerely hope that different sectors of society may evaluate OCTS objectively and review the development of the relationship between CPG and HKSAR with a rational and pragmatic attitude. We should break the vicious cycle of mutual suspicion, and construct positive interaction which is trusting and cooperative. Apart from objective analyses of facts and rational discussions, we also need moral courage to seek breakthroughs and dissolve antagonism. Being true to one’s principles would deserve respect, but in dealing with conflicts in the development of One Country, Two Systems, what is even more valuable is the ability to replace prejudices with empathy, mutual understanding and tolerance, the willingness to concede and compromise, and the sensibility to seek common ground. 

The success of One Country, Two Systems rests not in one side vanquishing the other, but in the Central Authorities and Hong Kong people marching in the same direction with a shared vision. One Country, Two Systems was created out of pragmatic needs. Whether it can become a model of peaceful resolution of political conflicts depends on our patience and wisdom.


Jasper Tsang
Andrew Fung
Executive and Research Director
Kay Lam