Tung is happy to be a puppet and he wants to make sure that others who come along will become puppets

Democratic Party leader Martin Lee

Critics say the law - proposed by the government - demolishes a crucial pillar of the autonomy the territory was promised when it was returned to China four years ago.

The controversy over the bill is just the latest row that has raised fears that Hong Kong's autonomy is slowly being chipped away.

The government is reportedly considering following China's example by banning the Falun Gong spiritual movement.

However, Mr Tung said he told Mr Bush the territory would continue to tolerate a broad range of religious expression.

"Freedom of the press and religion are alive and kicking and doing well," said Mr Tung. "Four years since the return of Hong Kong, one country-two systems is everyday reality."

Opposition fears

Mr Bush had raised questions about recent developments regarding the Falun Gong movement, said an official.

Critics fear the bill gives too much power to China

Mr Tung said he also updated Mr Bush on Hong Kong's recovery from the Asian financial crisis. They also discussed China's potential entry into the World Trade Organisation and Mr Bush's planned trip to China later this year, Mr Tung said.

A former shipping tycoon, Mr Tung took over from the last British governor, Chris Patten in July 1997, and was selected by a committee handpicked by Beijing. He is widely expected to stand for a second term with the Communist leadership's full backing.

Critics of the new bill say the legislation would ensure a second term for Mr Tung.

But Constitutional Affairs Secretary Michael Suen said pro-democracy politicians were worrying too much, because China would still have to follow Hong Kong's constitution.

'Puppet' leader

The constitution, known as the Basic Law, already implies Beijing can oust the Hong Kong leader if he is unable to carry out his duties, and the new bill does not offer any new powers, Mr Suen argued.

It merely spells out Beijing's ability to remove a Hong Kong leader incapable of serving, he said.

But in a debate that lasted all day the opposition argued that Beijing could use any number of reasons to fire a Hong Kong leader.

"Tung is happy to be a puppet and he wants to make sure that others who come along will become puppets," said Democratic Party leader Martin Lee

"Obviously, the government wishes to confer upon the central government what it didn't even ask for or want," he said. "Why kneel down and present a silver plate to give the autonomy back to Beijing?"