Lai owns the group which publishes anti-Beijing paper Apple Daily. His arrest marks the first time the law is being used against Hong Kong's news media.
Hong Kong media tycoon Jimmy Lai has been arrested over suspected collusion with foreign forces under the new national security law, in what is the highest-profile arrest yet under the legislation.
Lai's arrest was first shared by his top aide on Twitter on Monday. Hong Kong police later said they arrested 10 people in a national security operation including Lai and other senior executives at his Apple Daily newspaper.
The new security law punishes anything China considers subversion, secession, terrorism and collusion with foreign forces with up to life in prison.
"Jimmy Lai is being arrested for collusion with foreign powers at this time," Mark Simon, a senior executive at Next Digital, said early on Monday.
Lai's arrest and the search of his Next Digital group marked the first time the law was used against news media, stoking fears that authorities are suppressing press freedom. Next Digital operates Apple Daily, a feisty anti-Beijing tabloid that often condemns China's Communist Party-led government.
In the evening, police also arrested prominent anti-Beijing activist Agnes Chow Ting at her home, according to a tweet by fellow activist Nathan Law, who is currently in Britain. A post on Chow's official Facebook page said police had arrived at her home and that her lawyers were rushing to the scene.
Critics say the law crushes freedoms in the semi-autonomous city, while supporters say it will bring stability after prolonged pro-democracy protests last year.
Jimmy Lai is being arrested for collusion with foreign powers at this time.— Mark Simon (@HKMarkSimon) August 9, 2020
As of this time the police are in the homes of Mr. Lai and his son executing search warrants.— Mark Simon (@HKMarkSimon) August 10, 2020
Other members of the group have been detained or taken in for questioning. It’s a press scrum at Mr. Lai’s home now so info locally will come out.
Police did not immediately comment.
Apple Daily reported that Lai was taken away from his home in Ho Man Tin early on Monday. The paper says one of Lai's sons, Ian, was also arrested at his home.
Lai was also arrested this year on illegal assembly charges, along with other leading activists, relating to protests last year.
In an interview with Reuters in May, Lai pledged to stay in Hong Kong and continue to fight for democracy even though he expected to be one of the targets of the new legislation.
Before Monday, 15 people had been arrested under the law, including four aged 16-21 late last month over posts on social media.
The new legislation has sent a chill through Hong Kong, affecting many aspects of life. Activists have disbanded their organisations, while some have fled the city altogether.
Slogans have been declared illegal, certain songs and activities such as forming human chains have been banned in schools, and books have been taken off shelves in public libraries.
EU urges respect for 'press freedom'
The European Union has urged respect for human rights and freedom of expression in Hong Kong, after Lai's arrest.
"The recent arrests of Jimmy Lai, members of his family and other individuals, and the raid on the offices of newspaper Apple Daily, under allegations of collusion with foreign forces, further stoke fears that the National Security Law is being used to stifle freedom of expression and of the media in Hong Kong," European Commission foreign affairs spokesman Peter Stano said in a statement.
"The European Union recalls that the respect for human rights and fundamental freedoms is a central element of the Basic Law and the 'one country, two systems' principle."
Britain 'deeply concerned'
Britain accused China of using the national security law as a pretext to silence opposition.
"This is further evidence that the national security law is being used as a pretext to silence opposition. The Hong Kong authorities must uphold the rights and freedoms of its people," Prime Minister Boris Johnson's spokesman said.
"We are deeply concerned by the arrest of Jimmy Lai and six other individuals in Hong Kong. Freedom of the press is explicitly guaranteed in the Sino-British Joint Declaration, and basic law, and is supposed to be protected under Article Four of the National Security Law."
UN rights office 'concerned'
The UN human rights office also voiced deep concern at the arrest of Lai and others.
"We urge the authorities to review these cases to ensure that the arrests do not impinge on the exercise of rights protected by the international human rights law and Hong Kong' s Basic Law," Jeremy Laurence, spokesman for the office of UN High Commissioner for Human Rights Michelle Bachelet, said in an email reply to Reuters.
"We repeat our calls for the authorities to monitor and review the operation of the security law and to amend it if necessary to ensure there is no scope for its misuse to restrict human rights guaranteed by international law and the Basic Law of Hong Kong," he said.
China supports arrest
A spokesman for China's Hong Kong and Macau Affairs Office told the Xinhua agency that Lai was a representative of people who were "anti-China, anti-Hong Kong" and who were a danger that must be removed before there could be peace in Hong Kong.
"He arrogantly called on people to fight for the United States, participated in the planning, organisation and instigation of a series of illegal protests," Xinhua quoted the spokesman as saying.
He said that Lai also funded pro-independence forces and used his media to spread rumours and instigate violence.
The spokesman said Lai and the others arrested on Monday should be severely punished, to show that "justice may be late but never absent".