Economy

John Bolton knew of Huawei arrest before Trump-Xi dinner

John Bolton knew of Huawei arrest before Trump-Xi dinner

Canadian law enforcement detained Huawei Technologies' chief financial officer, Meng Wanhzou, in Vancouver, British Columbia, on December 1.

Canada did a similar favour for the Americans in July 2014 when it arrested a Chinese businessman in British Columbia for hacking the data bases of USA defence contractors to steal military secrets. Reuters was unable to determine the precise nature of the violations.

Earlier this year, the United States almost drove Huawei's biggest Chinese rival, ZTE Corp, out of business for selling equipment to North Korea and Iran in violation of U.S. sanctions.

Huawei is the world's largest supplier of equipment used by telephone and internet providers, and the world's third-biggest manufacturer of smartphones.

Stocks on both the Chinese mainland and in Hong Kong tumbled after news of the arrest, with tech firms taking the brunt of the selling of shares. Hong Kong's Hang Seng lost 2.5 percent and the DAX in Germany sank 1.8 percent. Investors stampeded for the safety of government debt, pushing the yield on the US 10-year Treasury note back below 2.9 percent to its lowest level in three months. She is the chief financial officer of Huawei Technologies, a huge telecommunications company. Meng was detained in Vancouver on 1 December and faces extradition to the U.S. over reported links to sanctions violations. The company has been accused of using its devices to pass on information to the Chinese government, prompting the US Department of Defense to ban their sale on military bases.

"Recently, our corporate CFO, Ms. Meng Wanzhou, was provisionally detained by the Canadian Authorities on behalf of the United States of America, which seeks the extradition of Ms. Meng Wanzhou to face unspecified charges in the Eastern District of NY, when she was transferring flights in Canada", the statement reads.

But it has since emerged that on the day the leaders talked trade in Argentina, the chief financial officer and deputy chairman of Huawei was arrested in Canada at the request of the US.

She was detained when she was transferring flights in Canada, it added.

FILE - People walk past a sign board of Huawei at CES (Consumer Electronics Show) Asia 2018 in Shanghai, China, June 14, 2018.

The Chinese government said Meng had broken no USA or Canadian laws and demanded Canada "immediately correct the mistake" and release her.

The Chinese Embassy in Ottawa said Meng broke no USA or Canadian laws and demanded Canada "immediately correct the mistake" and release her.

The U.S. launched a criminal probe into Huawei's dealings in Iran in April.

Meng wanzhou
HuaweiHuawei’s chief financial officer Meng Wanzhou

The US Justice Department on Wednesday declined to comment. A spokesman for the US attorney's office in Brooklyn also declined to comment.

"China has entertained hopes that they could split us away from the U.S.in the Trump era", he said.

Ms 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.

"You can play hardball with a small country but you can't do it with the USA", he said.

Ren responded: "We must not bind ourselves up just because the U.S.is attacking us". He said targeting Huawei, one of the most successful Chinese companies, "will trigger anti-US sentiment in China".

If a USA target is in one those countries, one option for the OIA is to contact Interpol to put out what is known as a red notice indicating there is an outstanding arrest warrant for that person.

Buenos Aires is 5 hours ahead of Vancouver, where the arrest took place, so it is possible that the Chinese delegation was unaware.

"Relations between the United States and China were supposed to be on the mend after a productive G20".

In that case, Su Bin - a Chinese national who had permanent residency in Canada - was eventually extradited to the USA where he pleaded guilty in 2016 to a criminal conspiracy, years in the making, to steal US military secrets.

In exchange, ZTE agreed to pay a hefty $1 billion fine and put an additional $400 million in escrow in case of future violations. Meng was detained in Vancouver but is facing potential extradition to the US, which had earlier opened an investigation into whether Huawei sold equipment to Iran despite sanctions on exporting there.

Meng's arrest is related to alleged violations of USA sanctions, according to Reuters news agency.

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