Canada court starts extradition hearing of China Huawei exec

Michel Comte, Agence France-Presse

Posted at Jan 21 2020 07:03 AM | Updated as of Jan 21 2020 08:33 AM

Huawei Chief Financial Officer Meng Wanzhou arrives at BC Supreme Court following a lunch break during her extradition hearing in Vancouver, British Columbia, Canada Jan. 20, 2020. Jennifer Gauthier, Reuters

VANCOUVER — The Chinese telecommunications executive whose arrest in Vancouver badly strained Canada-China relations went to court on Monday to fight extradition to the United States.

Meng Wanzhou, the chief financial officer of tech giant Huawei and eldest daughter of its founder Ren Zhengfei, is wanted by US authorities for alleged fraud.

Meng made no comment as she rushed past journalists and protesters waving "Free Meng" and "Trump stop bullying us" placards outside the British Columbia Supreme Court. Her husband and Chinese consular officials sat in a packed gallery to watch the proceedings.

In order to secure her freedom, Meng, known as the "princess of Huawei," must convince a Canadian judge that the US charges -- linked to alleged violations of US sanctions on Iran -- would not stand up in Canada and are politically motivated.

The US alleges Meng lied to HSBC Bank about Huawei's relationship with its Iran-based affiliate Skycom, putting the bank at risk of violating US sanctions against Tehran.

"Simply put, there is evidence she deceived HSBC in order to induce it to continue to provide banking services to Huawei," the Canadian justice department said in court filings.

Meng has denied the allegations. She has been out on bail, living in one of her 2 Vancouver mansions for the past year.

Earlier, China's foreign ministry called Meng's extradition case a "grave political incident" and urged Ottawa to release the Huawei executive in order to normalize relations.

"The US and Canada are abusing their bilateral extradition treaty," said foreign ministry spokesman Geng Shuang at a regular press briefing in Beijing.

Canadian Deputy Prime Minister Chrystia Freeland said Ottawa would not interfere in the case, adding that Canada "honors its extradition treaty commitments."

The Canadian justice department has said it will justify extradition by arguing that the US accusations against Meng would be considered a crime in Canada if they had occurred there -- a key test known as double criminality.

Her lawyers, however, will counter that misrepresentations, if they occurred, do not amount to fraud, and that Canada has not matched the US sanctions against Iran. 

"Sanctions drive this case," lead defense lawyer Richard Peck said in an opening statement.

"This case is founded on allegations of breach of US sanctions, which Canada has repudiated," he said.

"The US has cast (Meng's) alleged behavior as a fraud against a bank. This is an artifice," Peck said. Canada is effectively being asked "to enforce US sanctions."

CAUGHT UP IN US-CHINA ROW

Meng's arrest during a stopover of a Hong Kong-to-Mexico flight in December 2018 put the 47-year-old at the center of the US and China's battle over the technology giant's growing global reach.

It also stuck Canada in the middle of a trade row between the world's two largest economies, resulting in China restricting agricultural imports from Canada. 

In addition, China arrested 2 Canadians on what Canada said were vague and trumped-up charges of "harming national security."

China's "arbitrary detentions," according to Ottawa, of former Canadian diplomat Michael Kovrig and businessman Michael Spavor, only days after Meng was taken into custody, have been widely interpreted as retribution by Beijing aimed at pressuring Canada to free Meng.

The hearing in Vancouver is scheduled to last 5 days.

But if the US accusations are found to also be a crime in Canada, a further phase will follow in June, with the defense arguing that authorities conspired to nab Meng as part of a "covert criminal investigation."

In court documents, Canadian prosecutors assert that Huawei controlled the operations of Skycom in Iran; that its staff used Huawei email accounts and security badges, and its bank accounts were controlled by Huawei.

But Meng told HSBC executives in a presentation in 2013 that Huawei no longer owned Skycom and that she had resigned from that company's board.

From 2010 to 2014, HSBC and its American subsidiary cleared more than US$100 million worth of transactions related to Skycom through the US.

STUNTING HUAWEI'S RISE 

Ren Zhengfei has suggested that the case is part of a US plot to crush Huawei, which it sees as a security risk.

Prime Minister Justin Trudeau, who had hoped when he came to power in 2015 to deepen Canada's economic ties with China, earlier asked the US for help.

He told broadcaster TVA last month that he urged US President Donald Trump not to finalize a trade deal with China "that doesn't settle the question of Meng Wanzhou and the two Canadians."

Trump went ahead, however, and signed a "phase one" trade deal with China last week.

Former Canadian prime minister Jean Chretien and his ex-deputy John Manley have urged Trudeau to simply release Meng in a "prisoner swap" for Spavor and Kovrig to help restore relations with China.

But extradition experts consulted by AFP argued that that would encourage what some called Beijing's "hostage diplomacy" tactics.

© Agence France-Presse