Published: Fri, December 07, 2018
Money | By Bruce West

Huawei CFO arrested in Canada for violating Iran sanctions

Huawei CFO arrested in Canada for violating Iran sanctions

Meng was detained in Vancouver on Saturday, the day presidents Donald Trump and Xi Jinping met in Argentina and announced their deal.

Asian stock markets tumbled on the news, fearing renewed U.S. It's not an isolated incident, but rather the latest chapter in a long history of tension between China's smartphone and telecommunications giant and the USA government and businesses. Washington and Beijing are locked in a clash over which of the world's two largest economies will command economic and political dominance for decades to come. -China trade war? The sanctions investigations long preceded the trade war.

The Chinese Foreign Ministry demanded Thursday that Canada release Huawei Technologies Chief Financial Officer Meng Wanzhou who was arrested at the behest of the United States on suspicion of violating anti-Iran sanctions.

Perhaps the most striking detail of the arrest of Huawei executive Meng Wanzhou in Canada was that it took place on the same day that leaders from the U.S. and China were engaged in delicate trade talks in Buenos Aires. She faces extradition to the United States, and a bail hearing was set for Friday. He also claimed that the incident "will seriously impact China and the US implementing consensus reached between two state leaders".

Long viewed by USA intelligence agencies as a national security threat, Huawei is one of China's most prominent tech companies.

Connor Campbell, an analysts at Spreadex, wrote: "The Huawei arrest appears to be the straw that broke the camel's back". Under Trump and his predecessor, Barack Obama, Washington has pressured European countries and other allies to limit use of its technology.

Meng's detention also raised concerns about potential retaliation from Beijing in Canada, where Prime Minister Justin Trudeau sought to distance himself from the arrest.

Beijing has asked Washington and Ottawa to "immediately release the detained person" and explain the reason for her arrest, said a foreign ministry spokesman, Geng Shuang.

"I knew in advance".

Huawei, the biggest global supplier of network gear used by phone and internet companies, has been the target of deepening US security concerns. Markets are already incredibly nervous over slowing economic growth thanks to the inverted U.S. yield curve.

The timing is awkward following the announcement of a US-Chinese ceasefire in a tariff war over Beijing's technology policy. The report follows a decision by the U.S. this year to ban government purchases of Huawei gear. ZTE, China's second-largest telecoms equipment maker, agreed to pay $1.4 billion in total fines to the United States after Washington slapped a ban in April on purchases of essential American components for seven years to punish the company for Iran sanctions violations.

In exchange, ZTE agreed to pay a hefty US$1 billion (RM4.17 billion) fine and put an additional US$400 million in escrow in case of future violations.

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

A user of China's Twitter-like Weibo platform said Chinese should boycott products made by USA tech giant Apple Inc and instead buy Huawei products to show support for one of China's national champions. New Zealand and Australia already have. Huawei has also been taking heat in other markets.

Huawei, the biggest global supplier of network gear used by phone and internet companies, has been the target of US security organizations. "When China's got some tough political problem going, often it ends up arresting someone, some foreigner, some Chinese with another passport, and kind of holding them hostage".

But Huawei is not alone in having to deal with privacy troubles.

Houlden believes Huawei will prioritize business, and continue working towards approval for a 5G network with its Canadian partners. "They may see that Canada has to do this, and the Canadian investment relationship is important".

Ms Meng is the company's chief financial officer and the founder's daughter. She would also have to give up her passport, he said.

A Huawei spokesman declined to comment on Thursday and said that Wednesday's statement still stands.

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