Chinese embassy demands release of Huawei boss after arrest in Richmond

Fears expressed over retaliatory measures against Canadians doing business in China

As news spread around the globe of the arrest in Richmond of Huawei’s chief financial officer, the Chinese embassy in Ottawa has demanded her release.

Wanzhou Meng - the daughter of the Chinese communication giant founder, Zhengfei Ren – was arrested while changing flights at Vancouver Airport in Richmond on Saturday and is in custody, facing extradition to the U.S.

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“She is sought for extradition by the United States, and a bail hearing has been set for Friday,” Justice Canada spokesperson Ian McLeod said in a statement obtained early afternoon on Wednesday by the Richmond News.

In a statement posted online Wednesday, the Chinese embassy said Meng hasn't violated any U.S. or Canadian laws, and called the arrest a serious violation of human rights.

It says China will closely follow the developments on the case and "take all measures to resolutely protect the legitimate rights and interests of Chinese citizens."

Huawei
Huawei's CFO Wanzhou Meng

Meng appeared at BC Supreme Court in Vancouver on Wednesday and is set to have a bail hearing at the same venue on Friday.

A publication ban us in effect over the details of the arrest and extradition request from the U.S.

However, according to the Globe and Mail, Meng, 46, also the deputy chair of Huawei’s board, was arrested on suspicion she violated U.S. trade sanctions against Iran.

David Mulroney, a former Canadian ambassador to China, said U.S. and Canadian business executives could face reprisals in China.

"That's something we should be watching out for. It's a possibility. China's plays rough," Mulroney told The Associated Press.

"It's a prominent member of their society and it's a company that really embodies China's quest for global recognition as a technology power."

Mulroney said Canada should be prepared for "sustained fury" from the Chinese and said it will be portrayed in China as Canada kowtowing to Trump. He also said the Iran allegations are very damaging to Huawei and said China will push back hard.

U.S. Sen. Ben Sasse, a Republican member of the Senate armed services and banking committees, applauded Canada for the arrest.

"Americans are grateful that our Canadian partners have arrested the chief financial officer of a giant Chinese telecom company for (allegedly) breaking U.S. sanctions against Iran," he said.

Meng has been the CFO of Huawei Technologies since 2011 and vice chair of the company since March 2018.

In a statement initially issued exclusively to the Richmond News from Huawei’s corporate head office, the company hit out at Meng’s arrest.

The company said Meng faces “unspecified charges in the Eastern District of New York…The company has been provided very little information regarding the charges and is not aware of any wrongdoing by Ms. Meng.

“The company believes the Canadian and U.S. legal systems will ultimately reach a just conclusion.”

The statement went on to say how Huawei complies with all applicable laws and regulations where it operates, “including applicable export control and sanction laws and regulations of the U.N., U.S. and EU.”

Huawei Technologies, launched in 1987 in Shenzhen China, has been the largest telecommunication equipment producer in the world since 2012.

It also produces consumer electronics and this year overtook Apple to become the second-largest manufacturer of smartphones in the world, behind Samsung Electronics.

As news of the arrest reverberated around the world, the stock market plunged amid fears of renewed China/U.S. tensions.

The broad market decline came as the arrest of Meng overshadowed some positive comments on trade from Beijing and threatened to worsen trade tensions between the U.S. and China.

The lingering trade dispute has deepened investors' worries that the prospects for global economic and corporate earnings growth could be dimming.

The arrest came days after President Donald Trump met with Chinese President Xi Jinping to discuss the two nation's escalating trade dispute.

Markets had rallied on Monday on news that Trump and Xi had agreed at the summit over the weekend to a temporary, 90-day stand-down in the two nations' escalating trade dispute.

In 2017, Huawei had C$123.79 billion in revenue, ranking the 72nd on the Fortune Global 500.

It has provided products and services in more than 170 countries and has more than 180,000 employees over the world. It has offices in 60 countries, including one in Burnaby.

The U.S. government has been concerned about Huawei for years because of uncertainty over its relationship with the Chinese government.

Its founder, Ren, was a People’s Liberation Army soldier before starting the company and opponents say it retains links with China’s security services. Huawei has denied the links.

In 2011, the American government stopped Huawei from purchasing U.S. server technology company 3Leaf’s assets, for national security reasons.

In 2012, the House of Representatives released a report warning Huawei poses a national security threat to the U.S., and American companies and its government should avoid doing business with the company.

In May, the Pentagon banned the sale of Huawei phones on military bases.

In August, U.S. president Donald Trump signed an act to ban the use of Huawei components or services that are “essential” or “critical” to the systems they are used.

Other countries, such as Australia and New Zealand, have also followed the case.

In 2012, the Australian government banned Huawei from bidding for NBN, Australia's broadband access network, for national security reasons.

For the same reason, Australia’s government blocked China’s telecom giant Huawei from its 5G mobile network last summer.

This November, New Zealand's government banned its major telecommunications company Spark from using Huawei’s equipment, which is described to “have a serious national security risk.”

Nevertheless, Huawei is allowed to operate in Canada and in a September interview with the Globe and Mail, Scott Jones, head of Canadian Centre for Cyber Security, said Ottawa is confident sufficient safeguards exist to deal with the risks of telecommunications hacking or spying by China.

With files from the Canadian Press & Associated Press

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