Hong Kong government acts after pro-democracy group refuses to remove banners mocking Chinese President Xi Jinping from stall at Lunar New Year fair

• League of Social Democrats had been warned it was in violation of licence agreement
• Group was raising funds and collecting signatures for petition against police

Authorities demolished a pro-democracy party's stalls at Hong Kong's Lunar New Year market on Tuesday after it refused to remove political displays that mocked the city's leader and President Xi Jinping.

The Food and Environmental Hygiene Department shut two booths used by the League of Social Democrats at Victoria Park on Tuesday morning, after terminating the group's licence agreement.

This year's agreement, which the league signed, stipulated that it would only be allowed to sell flowers and food. Selling anything other than that was strictly prohibited, according to the deal.

The league was running the stalls mostly to raise funds, to collect signatures for a petition against the police's use of force against anti-government protesters, and to give flowers to supporters and donors.

"We asked the department if there was any way we may cooperate, but they said the licence had already been terminated," said Avery Ng Man-yuen, the league's chairman. "Everything in the cordoned area is already government property."

Ng rejected the suggestion his party had breached its licence agreement, and accused the department of suppressing freedom of expression.

"I don't care whether you are 'blue' or 'yellow'," he said, using terms for the polarised pro-government and pro-democracy camps.

"The most important point is about whether we have a choice, which now the officials are taking away."

Lunar New Year market stalls shut down over Hong Kong protest displays

Ng estimated the flowers, displays and banners mocking Xi, Chief Executive Carrie Lam Cheng Yuet-ngor and other government officials cost his party about HK$40,000 (US$1,150).

The Food and Environmental Hygiene Department reiterated that under the licence agreement, the licensed area could only be used for allowed products and not for other uses. It said officers already warned the league to rectify it at 11pm on Monday.

Over the past decade, the league has joined other pro-democracy groups, such as the Hong Kong Alliance in Support of Patriotic Democratic Movements of China, in running a stall at the Causeway Bay fair to raise funds and promote their causes.

The policy of allowing political campaigning at the fair changed this year amid months of violent civil unrest. All dry goods, including the popular politically themed products, were banned at all government-run Lunar New Year fairs in the city.

Officials said the move was an attempt to maintain order and ensure safety.

The league was warned on Sunday about its stalls, and the government asked the pro-democracy party to remove the materials by midnight on Monday to "protect the public interest". The department terminated the agreement after seeing no sign of the league complying with its request.

Ng said he would consider launching a civil suit against the department, to reclaim the confiscated property.

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