Huawei CFO Meng Wanzhou granted bail in Canada

12 Dec 2018

Huawei logo on glass. Image: alexeynovikov/Depositphotos

Trump may intervene in sensitive diplomatic case involving Huawei’s Meng Wanzhou.

Meng Wanzhou, the chief financial officer of Chinese telecoms equipment giant Huawei, has been granted $7.5m bail by a judge in Vancouver. Meng still awaits a hearing on extradition to the US.

The daughter of company founder Ren Zhengfei, Meng was arrested on 1 December. The context of the arrest was a US Department of Justice investigation into whether Huawei sold equipment to Iran despite sanctions on exports to the country.

Prior to her bail hearing yesterday (11 December), Meng spent a week in custody and cited ill health, including a previous cancer illness and inability to eat solid foods, as reasons for seeking bail.

As part of the deal, she must remain in British Columbia and stay indoors from 11pm to 6am every day at a residence that was selected for her. Meng will have to surrender her passports and wear an ankle bracelet. She will also have to cover the cost of her surveillance by security firms.

“We have every confidence that the Canadian and US legal systems will reach a just conclusion in the following proceedings,” Huawei said in a statement. “As we have stressed all along, Huawei complies with all applicable laws and regulations in the countries and regions where we operate, including export control and sanction laws of the UN, US and EU. We look forward to a timely resolution of this matter.”

Is Huawei a pawn in a bigger game?

The arrest of Meng Wanzhou came just as US president Donald Trump had signalled a truce in an ongoing trade war with China, sparking hostilities once again.

It also comes at a time when governments including the US, Australia and the UK are warning telecoms companies not to install Huawei equipment, claiming security risks. However, this could have more to do with protectionism as Asian tech companies are stealing a march on Silicon Valley when it comes to leading the field in future 5G communications standards as well as in smartphones, with Huawei now the second largest seller of smartphones in the world.

In recent days, Japan ordered a ban on Huawei and ZTE equipment for 5G after the US lobbying various governments over concerns about wireless monitoring of communications from overseas US military bases.

At the heart of the reason for Meng’s arrest is the fact that she served on the board of a Hong Kong company called Skycom, which is alleged to have done business with Iran between 2009 and 2014, indirectly violating sanctions against Iran.

The US has 60 days to provide the Canadian courts with evidence, otherwise Meng will be released.

Trump said he plans to intervene in the case if it serves national security interests or if it helps to seal a trade deal with China. “Whatever’s good for this country, I would do. If I think it’s good for what will be certainly the largest trade deal ever made – which is a very important thing, what’s good for national security – I would certainly intervene if I thought it was necessary,” Trump said.

The arrest of Meng has sparked protests across the world and has ignited a growing wave of Chinese nationalist sentiment. In retaliation, former Canadian diplomat Michael Kovrig was detained in China this week. Kovrig worked for the International Crisis Group think tank.

Canadian prime minister Justin Trudeau said that Canada was taking the arrest “very seriously”.

Huawei logo on glass. Image: alexeynovikov/Depositphotos

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years