Huawei heiress ar­rested at US be­hest in Canada Likely to es­ca­late ten­sion be­tween US & China

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for al­legedly ship­ping U.S.-ori­gin prod­ucts to Iran and other coun­tries in vi­o­la­tion of U.S. ex­port and sanc­tions laws.

The ar­rest and any po­ten­tial sanc­tions on the world’s sec­ond big­gest smart­phone maker could have ma­jor reper­cus­sions on the global tech­nol­ogy sup­ply chain.

U.S. stock fu­tures and Asian shares tum­bled as news of the ar­rest height­ened the sense a ma­jor col­li­sion was brew­ing be­tween the world’s two largest eco­nomic pow­ers, not just over tar­iffs but also over tech­no­log­i­cal hege­mony.

Huawei is not listed, but China’s sec­ond-largest tele­com equip­ment maker, ZTE Corp, sank nearly 6 per­cent in Hong Kong while most of the nearby na­tional bourses lost at least 2 per­cent. MSCI’s benchmark for global stocks .MIWD00000PUS de­clined 0.61 per­cent, and U.S. mar­kets were on track to open lower by 1 per­cent or more.

Huawei is al­ready un­der in­tense scru­tiny from U.S. and other west­ern gov­ern­ments about its ties to the Chi­nese gov­ern­ment, driven by con­cerns it could be used by the state for spy­ing. It has been locked out of the United States and some other mar­kets for tele­com gear. Huawei has re­peat­edly in­sisted Bei­jing has no in­flu­ence over it.

Meng, one of the vice chairs on the com­pany’s board and the daugh­ter of com­pany founder Ren Zhengfei, was ar­rested on Dec. 1 at the re­quest of U.S. au­thor­i­ties and a court hear­ing has been set for Fri­day, a Cana­dian Jus­tice Depart­ment spokesman said. Trump and Xi had dined in Ar­gentina on Dec. 1 at the G20 sum­mit.

Huawei said, “The com­pany has been pro­vided very lit­tle in­for­ma­tion re­gard­ing the charges and is not aware of any wrong­do­ing by Ms. Meng,” it said.

A file photo of Huawei owner’s daugh­ter Meng Wanzhou with Rus­sian Prez Vladimir Putin.

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