It is using a carrot and a stick. The stick comes in the form of the administration's determination to give tougher laws on the holding of demonstrations which will have retrospective effect from the stroke of midnight on 1 July, when the new order takes over.
The carrot is the likely offer to allow legislators who will be kicked out of office to hold a rally after the Chinese take-over during which they will address supporters from the balcony of the Legislative Council building.
Yesterday, Tung Chee-hwa, the chief executive-designate of the new special administrative region of Hong Kong, said that he hoped "nothing will spoil the happiness" of the handover events.
He insisted that demonstrations could be held, "as long as they are lawful, so long as they are quiet and peaceful, they will be fine".
However, a small storm is gathering over the new administration's intention to pass a new public order law in the early hours of 1 July which will have retrospective effect from the beginning of the day.
The Provisional Legislature, which replaces the current elected legislature, is expected to rubber stamp the law at a meeting which will start around 3am.
The new legislative council has been meeting across the border in Shenzhen and has already agreed on the contents of the law, which imposes new requirements for police permission and outlaws demonstra- tions deemed to threaten Chinese national interests.
Elise Leung, the incoming Secretary for Justice, said over the weekend that "anyone who intended to make use of the few hours to act against the laws, it would be at my discretion to prosecute them".
Although the discussion over the new laws only concerns a matter of timing it has agitated local lawyers because they see it as undermining the pivotal principle of common law which is that legislation should not be retrospective.
The common law will still apply in Hong Kong after next week.
It now seems certain that a whole range of demonstrations are being planned for both the day before and the day after the resumption of Chinese rule. One which may spark civil disobedience is to be held on the afternoon of 30 June where protesters will be targeting Chinese Premier Li Peng for his role in the Tiananmen massacre.
They wish to demonstrate as close as possible to the hall where the handover ceremonies are being held, however most of this area will form part of a security zone.
On the day after the Chinese takeover there are further threats of civil disobedience because Hong Kong's main centrally located open-air venues have been declared to be unavailable for protest activities.
There will be an unprecedented mobilisation of the police force during the five days of handover events.
The Chinese government is extremely nervous about its leaders having to face demonstrators, so nervous in fact that it is now insisting that Britain allows more People's Liberation Army troops into the territory before the handover so that they can provide the necessary security.