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Canada Arrests Huawei CFO for Violating US Sanctions on Iran -Report

Canada Arrests Huawei CFO for Violating US Sanctions on Iran -Report

Thursday, 6 December, 2018 - 14:15
Brent Lewin/Bloomberg via Getty Images
Beijing, Vancouver - Asharq Al-Awsat
Canada has arrested Huawei's global chief financial officer in Vancouver, where she is facing extradition to the United States on suspicion she violated US sanctions against Iran, the Globe and Mail newspaper reported on Wednesday.

Meng Wanzhou, who is one of the vice chairs on the Chinese technology company's board and the daughter of company founder Ren Zhengfei, was arrested on Dec. 1 and a court hearing has been set for Friday, a Canadian Justice Department spokesman said, according to the Globe and Mail.

The shock arrest of Meng, 46, raises fresh doubts over a 90-day truce on trade struck between Presidents Donald Trump and Xi Jinping on Saturday - the day she was detained.

Her arrest, revealed late on Wednesday by Canadian authorities, is related to US sanctions, a person familiar with the matter said. Reuters was unable to determine the precise nature of the possible violations.

Sources told Reuters in April that US authorities have been investigating Huawei, the world's largest telecoms equipment maker, since at least 2016 for allegedly shipping US-origin products to Iran and other countries in violation of US export and sanctions laws.

The arrest and any potential sanctions on the world's second-biggest smartphone maker could have major repercussions on the global technology supply chain.

US stock futures and Asian shares tumbled as news of the arrest heightened the sense a major collision was brewing between the world's two largest economic powers, not just over tariffs but also over technological hegemony.

Huawei is not listed, but China's second-largest telecom equipment maker, ZTE Corp <0763.HK><000063.SZ>, sank nearly 6 percent in Hong Kong while most of the nearby national bourses lost at least 2 percent.

MSCI's benchmark for global stocks <.MIWD00000PUS> declined 0.61 percent, and US markets were on track to open lower by 1 percent or more. 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.

Huawei is already under intense scrutiny from US and other Western governments about its ties to the Chinese government, driven by concerns it could be used by the state for spying. It has been locked out of the United States and some other markets for telecom gear. Huawei has repeatedly insisted Beijing has no influence over it.

Huawei, which generated $93 billion in revenue last year, confirmed the arrest in a statement. "The company has been provided very little information regarding the charges and is not aware of any wrongdoing by Ms. Meng," it said.

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

Chinese foreign ministry spokesman Geng Shuang told a daily briefing on Thursday that China had asked Canada and the United States for an explanation of Meng's arrest, but they have “not provided any clarification".

The Chinese consulate in Vancouver has been providing her assistance, he added, declining further comment. On Wednesday, China's embassy in Canada said it resolutely opposed the arrest and called for her immediate release.

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