China calls on Canada to free Huawei CFO or face consequences

#Crime

If extradited to US, Meng Wanzhou would face charges of conspiracy to defraud multiple financial institutions

Meng Wanzhou is accused of lying to a US bank about use of a covert subsidiary to sell to Iran amid sanctions (AFP)
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Monday 10 December 2018 8:01 UTC
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China warned Canada on Saturday that there would be severe consequences if it did not immediately release Huawei Technologies' chief financial officer, calling the case "extremely nasty".

Meng Wanzhou, Huawei's global chief financial officer, was arrested in Canada on 1 December and faces extradition to the United States, which alleges that she covered up her company's links to a firm that tried to sell equipment to Iran despite sanctions, according to Reuters.

The 46-year-old executive was arrested in Vancouver while changing planes, ratcheting up tensions between the US and China just as the countries' leaders agreed to a truce in their trade war, AFP said.

If extradited to the US, Meng would face charges of conspiracy to defraud multiple financial institutions, a Canadian court heard on Friday, with a maximum sentence of 30 years for each charge.

No decision was reached at the extradition hearing after almost six hours of arguments and counter-arguments. Meng - daughter of Huawei founder Ren Zhengfei, a former engineer in China's People's Liberation Army - is set to remain in custody until at least Monday, when a Canadian court is expected to decide on bail.

In the hearing that was adjourned on Friday, Canadian government lawyer John Gibb-Carsley asked for bail to be denied, saying Meng has been accused of "conspiracy to defraud multiple financial institutions".

Meng is specifically accused of lying to a US bank, identified by her lawyer as "Hong Kong Bank," about the use of a covert subsidiary to sell to Iran in breach of sanctions.

In a short statement, China's foreign ministry said that Vice Foreign Minister Le Yucheng had issued the warning to release Meng to Canada's ambassador in Beijing, summoning him to lodge a "strong protest".

Adam Austen, a spokesman for Canadian Foreign Minister Chrystia Freeland, said on Saturday there is "nothing to add beyond what the minister said yesterday".

Freeland told reporters on Friday that the relationship with China is important and valued, and Canada's ambassador in Beijing has assured the Chinese government that consular access will be provided to Meng.

When asked about the possible Chinese backlash after the arrest of Huawei's CFO, Prime Minister Justin Trudeau told reporters on Friday that Canada has a very good relationship with Beijing.

On Thursday, Trudeau defended Canada's arrest of Meng, saying politics played no part in the decision.

Canada has a long-standing extradition treaty with the US, requiring it to cooperate with US Department of Justice requests to hand over suspects.

The offence for which extradition is being sought must also be a crime in Canada, and a Canadian court must decide if there is sufficient evidence to support the extradition.

Canada's arrest of Meng at the request of the United States was a serious breach of her lawful rights, Le said. The move "ignored the law, was unreasonable" and was in its very nature "extremely nasty," he added.

"China strongly urges the Canadian side to immediately release the detained person and earnestly protect their lawful, legitimate rights, otherwise Canada must accept full responsibility for the serious consequences caused."

The statement did not elaborate.

"There will probably be a deep freeze with the Chinese in high-level visits and exchanges," David Mulroney, a former Canadian ambassador to China, said on Friday.

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Huawei chief faces US fraud charges relating to Iran sanctions

"The ability to talk about free trade will be put in the icebox for a while. But we're going to have to live with that. That's the price of dealing with a country like China."

Meng's arrest was on the same day that US President Donald Trump met in Argentina with China's President Xi Jinping to look for ways to resolve an escalating trade war between the world's two biggest economies.

The world's top two economies have exchanged steep tariffs on more than $300bn in total two-way trade, locking them in a conflict that has begun to eat into corporate profits.

"We are tracking the developments of this case and refer you to the filings in the Supreme Court of British Columbia," a US State Department official said on condition of anonymity.

The news of Meng's arrest has roiled stock markets and drawn condemnation from Chinese authorities, although Trump and his top economic advisers have played down its importance to trade talks after the two leaders agreed to a truce.

A Huawei spokesman said on Friday the company has "every confidence that the Canadian and US legal systems will reach the right conclusion". The company has said it complies with all applicable export control and sanctions laws and other regulations.