Ever since the Fall of France in June 1940 the Japanese have been forcing the French to make concessions in Indo-China. Today they decide that the military permissions and economic privileges they've been granted are not enough and the Imperial Conference decides to extend its military operations further into French territory so as to 'strengthen arrangements for advance to the south.'
The clock has now been set ticking: on July 26 the Americans respond by freezing Japanese assets in the USA, the next day the British abrogate Japan's commercial treaties with India and Burma. On August 1 a crucial American oil embargo is put in place, and on August 28 this is supplemented by a ban on oil and bauxite from the Netherlands East Indies. The Japanese war-machine won't be able to function for long without these commodities, so Japan now has two choices: get the best deal it can in return for a withdrawal from China or launch an all-out war.
Japanese-American talks begin, but neither side will make significant concessions, and they're still talking when the Japanese attack Pearl Harbour and Hong Kong.
From Hong Kong's point of view, as well as the general sense of increased menace, there's a particular worry: the colony's not been self-sufficient in food for a long time, and much of its rice suppy comes from South East Asia. And something the Japanese don't do will be significant when war comes: neither now or in the coming months do they occupy Kwangchowan (now Guangzhouwan) a French enclave on the Chinese mainland. This remains in the hands of the Free French, and ferry services there continue during the occupation, providing an escape or emigration route for those seeking to leave the colony until the Japanese finally invade in February 1943.
Source:
W. G. Beasley, Japanese Imperialism, 1894-1945, 1987, 230-232