Huawei CFO Meng Wanzhou must stay in BC to fight extradition

May 27 2020, 12:10 pm

Huawei Chief Financial Officer Meng Wanzhou must stay in Canada and keep fighting the US extradition order, a judge ruled on Wednesday.

In her decision, Justice Heather Holmes wrote that “as a matter of law, the double criminality requirement for extradition is capable of being met in this case.”

Holmes made her decision after legal arguments regarding whether or not the criminal allegations Meng is facing in the United States would be applicable in Canada.

Meng had argued that the “alleged conduct could not have amounted to fraud in Canada because it relates entirely to the effects of US economic sanctions against Iran, and at the relevant time Canada had no such sanctions,” Holmes’ decision states.

The allegations relate to the banking relationship between Huawei and HSBC, an international bank.

Meng is said to have made false statements to HSBC in 2013, “significantly understating Huawei’s relationship with Skycom Tech. Co. Ltd., a company based in Iran,” court documents state.

The documents also note that the banking relationship between Huawei and HSBC ran from at least 2007 to 2017, and involved “very significant transactions,” which included:

  • HSBC’s US subsidiary cleared very substantial dollar transactions for various Huawei entities between 2010 and 2014.
  • In August 2013, HSBC coordinated a syndicated loan to Huawei in an amount equivalent to USD $1.5 billion, and was one of the principal lenders.
  • In April 2014, HSBC sent Huawei a signed letter describing negotiated terms for a USD $900 million credit facility. HSBC was also part of a syndicate of banks that loaned Huawei USD $1.5 billion in July 2015.

According to court documents, “this all occurred while regulations were in place in the US that, among other prohibitions and restrictions, required banks to obtain authorization from the US Department of the Treasury’s Office of Foreign Assets Control before providing financial or credit services through the US to entities in Iran.”

Meng, who owns two houses in Vancouver, was arrested at YVR airport in December of 2018, in connection with the allegations. She has been under house arrest ever since.

At the time, and in response to her arrest, Huawei said in a statement it was “not aware of any wrongdoing” by Meng and said it had been provided  “very little information” on the incident, other than Meng being detained by Canadian authorities on behalf of the US when she was transferring flights in Canada.

The company said it “complies with all applicable laws and regulations where it operates, including applicable export control and sanction laws and regulations of the UN, US, and EU.”

They added it’s their belief that both the “Canadian and US legal systems will ultimately reach a just conclusion” in the matter.

On Wednesday, Justice Holmes wrote that the “effects of the US sanctions may properly play a role in the double criminality analysis as part of the background or context against which the alleged conduct is examined,” she added. “Ms. Meng’s application is therefore dismissed.”

Eric ZimmerEric Zimmer

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