The bill now before the Legislative Council defines seven types of “state secrets”, the disclosure of which could endanger national security, including secrets related to major policy decisions, national defence, armed forces and the economic, social, technological and scientific development of mainland China and Hong Kong.

The highest penalty for illegal disclosure of state secrets is a 10-year prison term.

Wong said the industry needed “legal reassurance” in the bill so that accountants, auditors and tax advisers would not risk legal liabilities when handling sensitive information and even trying to report suspicious national security breaches.

“One of our key responsibilities is to serve as a goalkeeper to safeguard Hong Kong’s status as an international financial centre,” he said.

“We worry that we may often run into a Catch-22. If we really come across such national security breaches and want to report them, there is a chance that we will breach our own code of conduct about confidentiality.”

Ronny Tong Ka-wah, a member of the Executive Council, the city’s key decision-making body, said that when doubts arose, accounting professionals could ask their information provider about how a particular document was obtained or seek advice from authorities whether it was classified as a state secret.

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“If he tells you that it was from a legal channel, then you can just believe him,” he said. “If you reasonably believe him, you will be rid of criminal intent.”

Tong, who is also a barrister, said auditing firms could still resign from such engagements or offer a qualified report to cast doubts on a company’s financial statements or reporting practices.

“This is your professional risk. Everything, even without the national security bill, has always been like this,” he said.

Solicitor and former accountancy sector lawmaker Kenneth Leung Kai-cheong said the legislation could lengthen audit procedures, as accounting firms would spend extra time and resources checking with security authorities whether a specific document was considered a state secret.

“Handling state secrets is one of the training items before auditors go to mainland China,” he said. “Current training may need to get more extensive [after the laws are introduced].”

In a position paper on the bill, the Hong Kong Bar Association said that many of the categories under state secrets had commercial implications, such as economic, social and technological developments, and suggested authorities offer more clarity.

The Post contacted major accounting firms known as the Big Four in the business: Deloitte, Ernst & Young (EY), KPMG and PwC.

PwC said it would not comment on the legislation, and the three others did not respond to queries.

A check by the Post found that of the 519 groups authorities listed as expressing support for the legislation during the month-long consultation that ended on February 28, none came from the accountancy sector.

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Queries to 13 Hong Kong accountancy groups, including the Institute of Internal Auditors, the Institute of Certified Public Accountants and the Business Accountants Association, also went unanswered.

Eleven accounting professionals, ranging from auditors at the Big Four accounting firms to partners from mid-tier companies, told the Post that they feared the legislation could create a grey area because of the broad definition of state secrets.

The Securities and Futures Commission said it had helped authorities gauge the industry’s views and concerns during the bill’s consultation.

The Accounting and Financial Reporting Council said the bill facilitated regulators’ work to ensure compliance across all financial institutions and addressed the city’s economic and fiscal security.

Both regulators said they supported the legislation.

A government spokesman said on Monday that prosecutors had the burden of proof beyond a reasonable doubt to get a defendant convicted.

“Normal business operators, as well as professional bodies complying with normal requirements of regulatory authorities, will not unwittingly violate the law,” he said.

As for disclosing state secrets, the spokesman said offences of this nature were based on information that satisfied both conditions – it belonged to any of the seven stipulated categories of secrets, and the unlawful disclosure would likely endanger national security.

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“If a person does not know that the information he or she discloses amounts to ‘state secrets’, and he or she does not have the intention to endanger national security, he or she will not unwittingly violate the law,” the spokesman said.

“Safeguarding of national security will provide a better business environment to businesses operating in Hong Kong.”

Lawmaker Wong later on Monday said he had reported industry concerns to authorities in a timely manner and had received positive responses.

“If it is handled in accordance with strict code of ethics and guidelines, there will be no problem,” he said on Facebook. “The industry fully supports the legislation.”

The bill is expected to enter the final stage of deliberation and pass at the Legislative Council as early as this week following marathon meetings by lawmakers to scrutinise its articles since it was gazetted on March 8.

Several legislators contacted by the Post on Sunday said they had not received any instructions to standby for a special full-council meeting before Wednesday’s regular session. They were later alerted on Monday that a full meeting would be held on Tuesday to complete the legislation.

People convicted of illegally acquiring state secrets can be punished by up to five years in jail while those guilty of unlawful possession may face up to three years in jail.