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Top exec of China’s Huawei arrested in Canada, faces extradition to US

A Huawei location in Santa Clara, Calif., on April 19, 2018. (Yichuan Cao/Sipa USA/TNS)
December 06, 2018

The chief financial officer of Chinese technology company Huawei was arrested over the weekend in Canada and will be extradited to the United States.

Meng Wanzhou, Huawei’s CFO and daughter of the company’s founder Ren Zhengfei, was arrested in Vancouver on Saturday at the request of the United States, who says Meng violated sanctions on Iran, according to CNN on Thursday.

Canadian Justice Department spokesman Ian McLeod said in a statement that Meng “is sought for extradition by the United States, and a bail hearing has been set for Friday.”

“The company has been provided very little information regarding the charges and is not aware of any wrongdoing by Ms. Meng,” Huawei said in a statement. “The company believes the Canadian and U.S. legal systems will ultimately reach a just conclusion. 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.”

Meng was taken into custody between flights at a Canadian airport on Saturday, the same day of President Trump’s meeting with Chinese President Xi Jinping.

The arrest has left speculation that it could further sour tensions between the U.S. and China, as Huawei is highly regarded in China. It is the second leading smartphone company in the world, and is the largest producer of cellular and internet networking equipment.

“The Chinese side has lodged stern representations with the U.S. and Canadian side, and urged them to immediately correct the wrongdoing and restore the personal freedom of Ms. Meng Wanzhou,” said a statement by the Chinese Embassy in Canada.

The Embassy also claimed that Meng did not violate “any American or Canadian law” and the arrest “seriously harmed the human rights of the victim.”

Huawei has long been suspected of facilitating surveillance or communication disruptions on behalf of the Chinese government. Huawei smartphones were banned from U.S. military bases this year over concerns of security threats.

Further, the Department of Justice has been probing Huawei’s dealings with Iran since April, and the company is suspected of violating sanctions imposed on Iran for more than two years.

Huawei’s competitor, ZTE, was also found to be violating sanctions on Iran.

Consequently, ZTE components were banned from the U.S., which devastated the company and nearly caused it to dissolve into bankruptcy. Earlier in this year, ZTE paid some $1.4 billion in fines to the U.S. and agreed to a management restructure in order to lift the ban in the U.S.

Huawei is preparing to roll out new 5G wireless technology, allowing greater connectivity to the internet through devices such as health monitors and autonomous vehicles, prompting greater concern over Huawei’s ability to access sensitive information. The U.K., Australia, and New Zealand have pre-emptively banned Huawei on 5G networks.