At a preliminary bail hearing on Friday, December 10, Canadian prosecutors revealed that the U.S. wishes to charge Huawei CFO Meng Wanzhou with lying to banks about the relationship between Huawei and a company that attempted to sell U.S. technology to Iran in violation of a U.S. ban on such transactions. Arrested December 1, Meng is due back in court today in a proceeding that is expected to determine whether she will be offered release on bail as she awaits an extradition hearing that could send her to the U.S. to face the charges.
Reuters asserts the charges stem from an expose the news organization published in 2013. In it, Reuters recounts that Hong Kong-based Skycom Tech Co. Ltd. is alleged to have attempted in 2010 to sell equipment from Hewlett-Packard to a service provider in Iran in defiance of a ban on the sale of U.S. technology to that country. Reuters reported in 2013 that there were close financial and other links between Skycom and Huawei that suggested the two companies were more than partners. Reuters also reported that Meng served on the board of Skycom between February 2008 and April 2009 and in 2007 was the company secretary of a management firm controlled by Huawei’s parent company that held all of Skycom’s shares at the time.
In its reporting on Fridays’ hearing, Reuters says that the U.S. will charge that Meng lied to financial institutions that inquired about Huawei’s relationship with Skycom in 2013 and thus conspired to defraud the financial institutions. The Canadian prosecutors argued that Meng should be denied bail because she is a flight risk.
Chinese Vice Foreign Minister Le Yucheng summoned the ambassadors of China and the U.S. to discuss the situation. He is said to have stated that Canada would face “serious consequences” if it did not release Meng. In a briefing held earlier today, Foreign Ministry Spokesperson Lu Kang was asked to describe what such consequences would entail. “If you want to know what these severe consequences are, I can tell you that they wholly depend on the Canadian side,” Lu replied.
Lu also indicated that China first learned of Meng’s arrest via the media. “According to the consular agreement between the two sides, the Canadian government should inform the Chinese diplomatic missions in Canada at the earliest time possible of its detention of a Chinese citizen for whatever reasons. But the Canadian government failed to do that,” he said.
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