Huawei CFO could be released as Canadian court set to announce ruling on extradition

The Supreme Court of British Columbia will examine on Wednesday whether Meng Wanzhou’s case meets a key threshold of Canada’s extradition law

Huawei's chief financial officer Meng Wanzhou has been under house arrest in Canada since 2018. Reuters Meng Wanzhou, Huawei’s chief financial officer, who was arrested by Canadian police in December 2018 on an extradition request from the US. Her case, based on fraud charges connected to her alleged violation of US sanctions on Iran, has infuriated Beijing and damaged the Canada-China diplomatic relationship.Show less

The chief financial officer of Huawei, fighting extradition to the US, gets her first shot at release this week in a case that’s triggered an unprecedented diplomatic tussle between the US, China and Canada.

On Wednesday, the Supreme Court of British Columbia is set to release a decision on whether Meng Wanzhou’s case meets a key threshold of Canada’s extradition law. If associate chief justice Heather Holmes rules that it fails to meet that test, Ms Meng could be released from house arrest in Vancouver. If not, extradition proceedings will continue.

The case was triggered when Ms Meng was arrested on a US handover request in December 2018 during a routine stopover at Vancouver airport, a city where she owns two homes and often spent summer holidays. The fallout has since spanned three countries.

Canada has an independent judicial system that functions without interference or override by politicians

Ms Meng, the eldest daughter of Huawei’s billionaire founder, Ren Zhengfei, has become the highest profile target of a broader US effort to contain China and its largest technology company, which Washington sees as a national security threat.

China has accused Canada of abetting “a political persecution” against a national champion. In the weeks after her arrest, China put two Canadians - Michael Spavor and Michael Kovrig - in jail, halted billions of dollars in Canadian imports and put two other Canadians on death row, plunging China-Canada relations into their darkest period in decades. US President Donald Trump muddied the legal waters further when he indicated early on that he might try to intervene in her case to boost a China trade deal.

Canadian Prime Minister Justin Trudeau - caught between his country’s two biggest trading partners - has resisted any such attempt to interfere in the high-stakes proceedings, saying the rule of law will govern Ms Meng’s case.

“Canada has an independent judicial system that functions without interference or override by politicians,” Mr Trudeau said last week in response to comments by the Chinese ambassador that Ms Meng’s case was the biggest thorn in Canada-China relations. “China doesn’t work quite the same way and doesn’t seem to understand that we do have an independent judiciary.”

China’s foreign ministry didn’t respond to a request for comment.

Ms Meng, 48, faces tough odds: of the 798 US extradition requests received since 2008, Canada has refused or discharged only eight cases, or 1 per cent, according to Canada’s Department of Justice.

Whether she goes free or continues her battle against US extradition, the ruling is likely to further escalate the fight between Washington and Beijing, increasingly at loggerheads over everything from the coronavirus pandemic to the status of Taiwan and Hong Kong to trade and investment.

Huawei continues to play a central role in those tensions. Earlier this month, the Commerce Department barred chipmakers using American equipment from supplying Huawei without US government approval, closing a loophole in an effort to cut the Chinese company off from essential supplies used in its phones and networking gear. The move drew condemnation from Beijing and warnings from Huawei’s rotating chairman, Guo Ping, that the latest US curbs on its business would cause the whole industry to “pay a terrible price".

The US government has lobbied its allies, including Canada, to ban Huawei from next-generation 5G networks, saying its equipment would make such infrastructure vulnerable to spying by the Chinese government. Despite that, the UK said in January it would allow Huawei a limited role. But in recent days, British media have reported the government is backtracking and preparing to end Huawei’s presence by 2023.

Mr Trudeau has been stalling on Canada’s decision with the fates of Mr Spavor and Mr Kovrig hanging in the balance. The two detainees have been confined for more than 500 days without access to lawyers. In contrast, Ms Meng was photographed by CBC News on Saturday as she posed with nearly a dozen colleagues and friends - social distancing rules to fight the virus notwithstanding - displaying victory signs in front of the courthouse.

The US has been lobbying its allies to ban Huawei from 5G networks, saying its equipment would make their infrastructure vulnerable to spying by the Chinese government. Reuters

The pursuit of Ms Meng by US authorities predates the Trump administration: officials were building a case against her since at least 2013, according to court documents. Central to the case are allegations that Ms Meng committed fraud by lying to HSBC Holdings and tricking the bank into conducting Iran-related transactions in breach of US sanctions.

Wednesday’s ruling will focus on whether the case meets the so-called double criminality test: would Ms Meng’s alleged crime have also been a crime in Canada?

Her defense has argued that the US case is, in reality, a sanctions-violations complaint framed as fraud in order to make it easier to extradite her. Had Ms Meng’s alleged conduct taken place in Canada, the transactions by HSBC wouldn’t violate any Canadian sanctions, they say. The US bank and wire fraud charges carry a maximum term of 20 years in prison on conviction.

If the ruling goes against her, Ms Meng’s next court hearings are scheduled for June and are set to continue to at least the end of the year. Appeals could lengthen the process for years longer.