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Huawei crackdown

Huawei's Meng Wanzhou loses key decision in extradition case

Canadian judge rules against releasing chief financial officer

Huawei Technologies Chief Financial Officer Meng Wanzhou leaves her home to attend a court hearing in Vancouver, British Columbia, Canada on May 27.   © Reuters

NEW YORK -- A Canadian judge on Wednesday ruled that the extradition trial of Meng Wanzhou, Huawei's chief financial officer, will move on to the next stage as the premise of the U.S. extradition request -- "double criminality" -- is met.

"On the question of law posed, I conclude that, as a matter of law, the double criminality requirement for extradition is capable of being met in this case. The effects of the U.S. 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," wrote Associate Chief Justice Heather Holmes of the British Columbia Supreme Court in the judgement. "Ms. Meng's application is therefore dismissed."

Holmes had to determine whether the case meets the standard of double criminality, which means the charges against Meng need to be considered criminal in both the U.S. and Canada, for her to be extradited. The result is well expected, as the bar for double criminality is normally low, according to Yves Tiberghien, politics professor at the University of British Columbia.

Meng's high-profile extradition trial has drawn much attention as it stands at the height of tensions among the U.S., China and Canada.

"While the Trudeau government has scrupulously avoided involvement in the case, it is clear that in its origins in the U.S. fight against Huawei and in its consequences for Canada-China and Canada-U.S. relations, it is deeply political," said Paul Evans, public policy and global affairs professor at the University of British Columbia.

The judgement came 18 months after her arrest and roughly four months since Meng, 48, stood trial at the British Columbia Supreme Court to face charges of defrauding banks and breaching sanctions on Iran.

The Crown Counsel, Canada's prosecutors, argued that since wire and bank fraud are crimes in both countries, the extradition order is valid. Meng's lawyers contend the case centers on the violation of U.S. sanctions, which Canada no longer has in place.

Justice Holmes wrote in the judgement that if Meng's alleged actions had taken place in Canada and she were being tried in a domestic case, prosecutors would treat U.S. sanctions as a factor in creating economic risks for companies doing business with Huawei. Double criminality, she concluded, is thus able to play a proper role in Meng's case.

"Huawei is disappointed in the ruling today by the Supreme Court of British Columbia. We have repeatedly expressed confidence in Ms. Meng's innocence. Huawei continues to stand with Ms. Meng in her pursuit for justice and freedom," a Huawei spokeswoman said. "We expect that Canada's judicial system will ultimately prove Ms. Meng's innocence."

People hold signs calling for China to release Canadian detainees Michael Spavor and Michael Kovrig during an extradition hearing for Huawei CFO Meng Wanzhou at the British Columbia Supreme Court in Vancouver in March 2019.   © Reuters

Meng's arrest in December 2018 at the request of the U.S. government drew Canada into the White House's increasingly bitter trade and technology battle with Beijing. Two Canadian citizens, Michael Kovrig and Michael Spavor, were arrested in China over charges of "endangering national security" nine days after Meng was detained.

China had often demanded the release of Meng and had hinted that the return of the two Canadians could be negotiated upon Meng's return.

In terms of exports, Canadian agricultural exporters started to experience difficulties clearing customs in China soon after Meng's arrest. Canola exports were among the hardest hit. China previously accounted for 40% of Canada's canola seed exports. China will likely keep pressuring Canada.

"China will issue a very angry statement, but I don't expect fundamental change, as the China-Canada relation has been in damage control mode for a few months," said Tiberghien.

The Chinese Embassy in Ottawa issued a statement criticizing the judge's decision, according to its official account on Twitter.

"The U.S. and Canada, by abusing their bilateral extradition treaty and arbitrarily taking forceful measures against Ms. Meng Wanzhou, gravely violated the lawful rights and interests of the said Chinese citizen," the embassy wrote in the statement. "The purpose of the U.S. is to bring down Huawei and other Chinese high-tech companies, and Canada has been acting in the process as an accomplice of the U.S. The whole case is entirely a grave political incident."

Public reaction in China has also been heated, with news of Meng's setback generating a wave of angry reactions on Weibo, a Twitter-style social media platform.

"[Canada] is targeting foreign companies for political reasons in the name of the law. Shameless!" wrote one user. The comment garnered nearly 15,000 "likes."

"Sanction Canada," said another user, with 12,999 likes.

Huawei has enjoyed staunch public support in China since it came into conflict with Washington in 2018. Many social media users stayed up overnight for the court ruling, which was widely described as a "national humiliation." Others, however, were quick to criticize such backlash as being "uninformed."

State media, too, was swift to condemn the court's decision.

"This seems to be a lawsuit against an individual, but essentially, it takes aim at Chinese private firm Huawei," the state-owned China Daily wrote in a commentary on Thursday following the ruling result. "This is not the first time that the West has politicized a legal matter, and it will not be the last time."

The judgement will keep Meng under house arrest in her multi-million dollar home in Vancouver. She has another chance to walk free, if the court finds that the Canadian authorities violated Meng's rights during her arrest, as her lawyers had alleged.

"It is likely Meng's legal team will make an appeal that will have to be heard before the second period begins," said Evans. "[This case] could take many months or years."

Justice Homes has directed Meng to appear next before court on June 15.

Additional reporting by Coco Liu in Hong Kong.

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