Canadian businesses face retaliatory risk after Huawei arrest in Vancouver

Canadian businesses face retaliatory risk after Huawei arrest in Vancouver

The massive fall in stocks was preceded by a major scandal involving the arrest of Huawei Technologies' chief financial officer, Wanzhou Meng in Vancouver at the request of the U.S. government, threatening to undermine the recently reached understanding between Beijing and Washington on their ongoing trade war.

Meng was arrested in the western city of Vancouver on December 1, Canada's ministry of justice said in a statement.

In a brief announcement released today, Canada's Department of Justice has announced that it has arrested the Chief Financial Officer of Huawei, Meng Wanzhou.

"The company has been provided very little information regarding the charges and is not aware of any wrongdoing by Ms Meng (Wanzhou)", it said. He said targeting Huawei, one of the most successful Chinese companies, "will trigger anti-US sentiment in China". "The Chinese side firmly opposes and strongly protests over such kind of actions which seriously harmed the human rights of the victim", the statement said.

Press representatives for the Justice Department and the USA attorney's office in the Eastern District of NY declined to comment. It appears that the arrest is likely in connection to an ongoing USA investigation into Huawei allegedly violating worldwide sanctions against Iran and North Korea.

Meng is the daughter of the company's founder, Ren Zhengfei, and has recently become his presumed successor.

"The news on Huawei throws another level of uncertainty on our ability to actually come to some agreement with China".

An executive with a US-based multinational company, meanwhile, said the incident may not be part of Trump's tactics.

The arrest comes at a sensitive time for US-China relations.

An anonymous Canadian law-enforcement source told The Globe and Mail that the United States is alleging Meng tried to evade USA sanctions against Iran.

HUAWEI: The news of Huawei CFO Meng Wanzhou's arrest sent shares sharply lower.

Hong Kong-listed ZTE, which was subject to a United States banning order earlier his year over security fears before that was reduced to a massive fine, was nearly five percent down.

"We need a comprehensive plan to hold the Chinese and their state-sponsored entities accountable for gross violations of the law and threats to our security", he said.

The arrest will not help the 90-day tariff truce the nations agreed after President Donald Trump and his Chinese counterpart Xi Jinping met at the G20.

Senator Chris Van Hollen, a Maryland Democrat, said Wednesday night that Huawei and ZTE "are two sides of the same coin - Chinese telecommunications companies that represent a fundamental risk to American national security". The U.S. government has largely banned the use of Huawei equipment by its agencies, and intelligence officials have warned that Beijing may have the ability to tap into the firm's equipment to spy on users.

Skycom tried to evade United States sanctions against Iran and sell Hewlett-Packard computers to the country's largest mobile phone operator in 2010.

What's more, Meng's detention raises questions about the Trump administration's overall China strategy.

On Wednesday, British phone carrier BT said it was removing Huawei equipment from the core of its mobile phone networks.

Meng's arrest and detention have only amplified the already-tense state of U.S. US national Security officials were aware of the arrest prior to the news breaking Wednesday evening, a different source said.

The U.S. has been investigating the alleged shipment of U.S. -made products to Iran in violation of U.S. laws since 2016.

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