Huawei scion held on ‘breach of US sanc­tions’


Huawei chief fi­nan­cial of­fi­cer and deputy chair­woman Meng Wanzhou, the daugh­ter of the Chi­nese telecom­mu­ni­ca­tions gi­ant’s founder, has been ar­rested in Canada on a US ex­tra­di­tion war­rant, cast­ing a cloud over ne­go­ti­a­tions on a trade agree­ment be­tween Wash­ing­ton and Bei­jing.

Ms Meng was ar­rested by Cana­dian au­thor­i­ties last Satur­day when she was trans­fer­ring flights through Van­cou­ver, re­port­edly on charges of vi­o­lat­ing trade sanc­tions against Iran.

China de­manded her im­me­di­ate re­lease and a for­mer Cana­dian am­bas­sador to Bei­jing, David Mul­roney, said US and Cana­dian busi­ness ex­ec­u­tives could face reprisals in China.

The 41-year-old, whose fa­ther Ren Zhengfei founded the Shen­zhen-based com­pany that is one of the world’s largest sup­pli­ers of telecom­mu­ni­ca­tions equip­ment, is in jail pend­ing a bail hear­ing to­day.

Re­pub­li­can sen­a­tor Ben Sasse, a mem­ber of the US Se­nate armed ser­vices and bank­ing com­mit­tees, said yes­ter­day Amer­i­cans were “grate­ful” that Canada had ar­rested Ms Meng “for break­ing US sanc­tions against Iran”.

The ar­rest took place on the same day US Pres­i­dent Don­ald Trump met with his Chi­nese coun­ter­part Xi Jin­ping to dis­cuss the trade war af­ter the close of the G20 sum­mit in Ar­gentina.

It an­gered China at a sen­si­tive time af­ter the Trump-Xi talks un­leashed ne­go­ti­a­tions for a new trade deal by March. The US has been press­ing China for im­me­di­ate ac­tion on cut­ting tar­iffs on car im­ports and in­creas­ing its pur­chases of US goods to re­dress the trade im­bal­ance be­tween the two coun­tries, although very lit­tle has been an­nounced by the Chi­nese.

The suc­cess­ful con­clu­sion of dis­cus­sions within the 90-day ne­go­ti­at­ing pe­riod will de­pend on con­sid­er­able good­will on the Chi­nese side to give enough ground to sat­isfy US de­mands.

The news of the ar­rest sent shares in Huawei plum­met­ing and the Chi­nese cur­rency weak­ened on fears it would throw a span­ner in the trade talks.

The Chi­nese em­bassy in Ot­tawa protested to the Cana­dian gov­ern­ment, say­ing Ms Meng’s rights have been vi­o­lated and de­mand­ing her im­me­di­ate re­lease.

“At the re­quest of the US side, the Cana­dian side ar­rested a Chi­nese cit­i­zen not vi­o­lat­ing any Amer­i­can or Cana­dian law,” the em­bassy said.

The em­bassy “firmly op­poses and strongly protests” the ac­tion, which had “se­ri­ously harmed the hu­man rights of the vic­tim”.

Cana­dian Jus­tice De­part­ment spokesman Ian McLeod said Ms Meng had sought a pub­li­ca­tion ban on the re­lease of any more de­tails on the al­le­ga­tions, ahead of a bail hear­ing in Van­cou­ver to­day.

The US Jus­tice De­part­ment has been in­ves­ti­gat­ing Huawei’s ship­ping of US-ori­gin prod­ucts to Iran and other coun­tries in vi­o­la­tion of US ex­port and sanc­tion laws, which was re­vealed by The Wall Street Jour­nal in April.

Huawei said yes­ter­day it had been pro­vided with very lit­tle in­for­ma­tion on the charges and was “not aware of any wrong do­ing” by Ms Meng. “The com­pany be­lieves the Cana­dian and US le­gal sys­tems will ul­ti­mately reach a just con­clu­sion,” it said.

The com­pany said it com­plied with “all ap­pli­ca­ble laws and reg­u­la­tions” where it op­er­ates, in­clud­ing ex­port con­trol and sanc­tion laws and reg­u­la­tions of the UN, the US and the EU.

Huawei was banned from sup­ply­ing equip­ment to Aus­tralia’s next-gen­er­a­tion 5G net­work ear­lier this year, a move fol­lowed by New Zealand. This week Bri­tish telecom­mu­ni­ca­tions com­pany BT said it would re­move Huawei tech­nol­ogy from its 3G and 4G net­works, and not in­clude it in the 5G net­work. Wash­ing­ton has also barred Huawei ri­val ZTE from ex­port­ing US tech­nol­ogy in a sep­a­rate case over ex­ports to Iran and North Ko­rea. The al­lies are con­cerned about po­ten­tial Chi­nese regime in­ter­fer­ence, although Huawei has de­nied this.


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