HONG KONG, July 29 (Reuters) - Hong Kong leader Carrie Lam has warned the city is on the brink of a large-scale COVID-19 outbreak, and urged people to stay indoors as much as possible as strict new measures to curb the disease's spread take effect on Wednesday (Jul 29).

The new regulations ban gatherings of more than two people, close dining in restaurants and make the wearing of face masks mandatory in public places, including outdoors. These are the toughest measures introduced in the city since the outbreak.

The government has also tightened testing and quarantine arrangements for sea and air crew members, effective on Wednesday.

"We are on the verge of a large-scale community outbreak, which may lead to a collapse of our hospital system and cost lives, especially of the elderly," Lam said in a statement late on Tuesday.

"In order to protect our loved ones, our healthcare staff and Hong Kong, I appeal to you to follow strictly the social distancing measures and stay at home as far as possible."

The new measures, which will be in place for at least seven days, were announced on Monday after the global financial hub saw a spike in locally transmitted cases over the past three weeks.

On Tuesday, Hong Kong reported 106 new coronavirus cases, including 98 that were locally transmitted. Since late January, more than 2,880 people have been infected in Hong Kong, 23 of whom have died.

The union representing FedEx Corp pilots on Tuesday called on the US package delivery company to suspend its operations in Hong Kong after some of its members were subject to "extremely difficult conditions" in government-mandated quarantine aimed at tamping down the spread of the coronavirus.

The Air Line Pilots Association International (ALPA) said three FedEx pilots infected with the coronavirus were forced into mandated hospital facilities for up to 10 days in Hong Kong. Those pilots were asymptomatic.

Several other pilots who tested negative, but had been in contact with individuals who tested positive, were put in government camps "under extremely difficult conditions," the world's largest pilots' union said.

"Not only do these situations pose unacceptable risks to our pilots' safety and wellbeing, but they also create added stress and distraction for flight operations," said Dave Chase, chairman, FedEx ALPA Master Executive Council.

FedEx in a statement said the company was fully engaged with government authorities to support its crew members in situations that required medical treatment or self-isolation in Hong Kong.