The Trump Administration sent a formal notice to Congress that it doesn’t see Hong Kong as an autonomous region from China. 

Politico says that puts Hong Kong’s status as a separate customs territory at risk and opens up Beijing to sanctions. 

The move would hurt Beijing but also lessen Hong Kong as an Asian center for business and finance. 

“I fully expect the U.S. to proceed with sanctions on individuals and entities deemed to be undermining Hong Kong’s autonomy,” says Bonnie Glaser, director of the China Power Project at the Center for Strategic and International Studies. 

Politico says Beijing recently proposed a “national security law” that would bypass Hong Kong’s legislature and give China more authority to crack down on protests. 

What’s next for the U.S. is currently up to President Trump, who hinted at the possibility of sanctions on the Asian nation. 

China has already vowed to retaliate if the U.S. takes strong actions because of its moves against Hong Kong. 

Assistant Secretary of State for East Asian and Pacific Affairs David Stilwell says the possibilities include personnel sanctions, visa sanctions, economic sanctions, as well as numerous other options. 

The U.S. Chamber of Commerce says any changes to Hong Kong’s status could have serious impacts on the more than 1,300 U.S. companies that operate in the island nation.