The New Zealand Government has suspended its extradition treaty with Hong Kong and made a number of other changes in light of China's decision to pass a national security law for Hong Kong.

Foreign Affairs Minister Winston Peters said on Tuesday China's passing of the legislation has "eroded rule-of-law principles" and "undermined the 'one country, two systems' framework" that underpins Hong Kong's unique status.

Peters said it "goes against commitments China made" to the international community.

"In light of this, it is important that New Zealand responds proportionately and deliberately to the passage of the national security law. As part of that response, Cabinet has decided to suspend New Zealand's extradition treaty with Hong Kong," Peters said.

"New Zealand can no longer trust that Hong Kong's criminal justice system is sufficiently independent from China. If China in future shows adherence to the 'one country, two systems' framework then we could reconsider this decision."

Peters said New Zealand's review of its overall relationship with Hong Kong is ongoing, but he announced two other outcomes from it - including changes to the treatment of sensitive goods to Hong Kong.

"From now on, we will treat military and dual-use goods and technology exports to Hong Kong in the same way as we treat those exports to China. Secondly, we have updated our travel advice to alert New Zealanders to the risks presented by the National Security Law," Peters said.

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"New Zealand remains deeply concerned at the imposition of this legislation, and we will continue to monitor the situation in Hong Kong as the law is applied. As a result, the review of our cooperation settings with Hong Kong will be ongoing."

The Chinese Embassy in New Zealand said the Government's decision is "a serious violation of international law and basic norms governing international relations".

"It is a gross interference in China's internal affairs. The Chinese side has lodged its grave concern and strong opposition," it said in a statement.

"The Law on Safeguarding National Security in the Hong Kong SAR is an important step to ensure the steady and sustained implementation of the 'one country, two systems' principle. Its implementation will strengthen Hong Kong's legal framework, ensure social order, improve business environment and contribute to Hong Kong's long-term prosperity and stability.

"Any attempt to pressure China on the issue of Hong Kong will not succeed. The Chinese side urges the New Zealand side to abide by the international law and the basic norms governing international relations, immediately stop interfering in Hong Kong affairs and China's internal affairs in any forms to avoid further harm to China-New Zealand relations."

Peters announced that New Zealand would review its relationship with Hong Kong earlier this month after the new security law was passed.

It came after the Australian Government cautioned citizens against travelling to Hong Kong, warning them about new measures in the security law that allowed for extradition to mainland China.

What is the security law?

Beijing passed new legislation earlier this month, bypassing Hong Kong's local Parliament, which Western politicians have said breaks the 'one country, two systems' framework Hong Kong has been operating under.

The new law allows extradition to the Chinese mainland for trial. It punishes crimes of separatist activity, state subversion, terrorist activity and collusion with foreign forces, which can be punishable by up to life in prison.

The Chinese Embassy urged New Zealand earlier this month to "stop interfering in Hong Kong affairs and China's internal affairs, and do more to promote the sound and steady development of the China-New Zealand relations".

The UK ambassador to the United Nations Julian Braithwaite delivered a joint statement on behalf of 27 countries - including Australia and New Zealand - expressing concern over the new law.

Prime Minister Jacinda Ardern has expressed concern over the security law, telling 500 delegates at the NZ-China Business Summit in Auckland last week saying New Zealand will take a different view to China on certain issues.

"The New Zealand Government takes a stance where as representatives of the New Zealand people we think that the public has a direct and a resounding interest in the outcome," she said. 

"As you know, this has come to the fore recently around developments like Hong Kong's new security law; the situation of the Uighur people in the Xinjiang province; and Taiwan's participation in the World Health Organization.

"This is important to who we are as New Zealanders."

The Chinese Embassy has insisted the security law in Hong Kong is "purely China's internal affair" and said it "firmly opposes any foreign interference in China's internal affairs and Hong Kong affairs".