Huawei Hearing to Begin in Canada This Week

By  //  January 23, 2020

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Huawei Chief Financial Officer Meng Wanzhou will be returning to Vancouver where, along with her lawyers, she will build on the argument against the U.S extradition request.

Huawei Chief Financial Officer Meng Wanzhou will be returning to Vancouver where, along with her lawyers, she will build on the argument against the U.S extradition request.

The case that has been going on for over two years is moving along slowly. The U.S is basing its extradition requests on sanction violation, meanwhile, China is repeatedly calling for Canada to release her.

The case has caused great distress to Canada itself. It affected Canada’s overall economic state as well as contributed to political tensions between Canada and China.

Forex brokers in Canada saw major unexpected shifts in the market amidst the Huawei scandals and the talks about the trial taking place in Canada.

But these tensions might be coming to an end with the trial, the first phase of which will take at least four days, so we won’t have any definitive answers till the end of the week. 

The case against Meng Wanzhou

Meng arrived in Vancouver on January 21st for the first phase of hearing and her team will be arguing that “double criminality” was at the heart of the case.

Currently, Meng is charged in the U.S with bank fraud and is accused of misleading HSBC Holding PLc about Huawei Technologies Co Ltd’s business in Iran.

The U.S believes that Meng covered up attempts by Huawei-linked companies to sell equipment to Iran, which was violating U.S sanctions against the country.

It has been made public that court United States issues the arrest warrant, which Canada acted on in December 2018.

Throughout this process, Huawei has been put through a lot of financial trouble and had to rebuild itself apart from the U.S consumer base.

Canada has been caught in the middle of this disagreement and had to manage the difficult situation with Meng in the country.

This court hearing could finally put an end to the ambiguous fate of Huawei CFO, but could potentially escalate its relationship with both countries, who are very important to Canada’s economic well being. Amidst this politically charged case, Canada has also been going through a tough time at home.

In December of last year, Canada experience biggest job loss that the country has seen since 2009, with around 71k Canadians losing their jobs at the end of the year and the unemployment has gone up to 5.9% from October’s 5.5% which is the biggest jump in that time frame that country has seen in over a decade.

The political tensions like the one with Huawei, often have a negative effect on the country’s economic state. While the court session is inevitable it poses a question of whether Canada will have to deal with serious consequences. 

China’s response to Canada

While China is now busy fighting off the mysterious lethal virus, there is still a threat of economic hardship that the country could send in Canada’s way.

But we do know that the Northern American neighbor is unlikely to betray each other, but the tensions could still arise on that front as well.

It has been said multiple outlets that the way these things operate, we can’t be sure as to what the outcome will be. And since the lawyers supporting Meng Zanzhou, are planning to use that argument that Canada permits banks to do business with Iran so Meng can’t be extradited on these grounds, the outcome can’t be predicted.

The court hearing will begin by the series of legal battles over the fate of the daughter of the founder of Huawei, Ren Zhengfei. Meng’s lawyer, Richard Peck said that Canada is a sovereign nation and has its own laws.

Canada stopped enforcing sanctions against Iran in 2016. Meanwhile, Lawyers working for Canada’s Justice Department have publically come out in favor of the U.S extradition request, citing U.S allegations that she misled some of the Chinese company’s banks, most importantly to HSBC to keep them as Huawei’s bank services provider.

Meng has already made herself into an international symbol of tensions between the U.S and China, with Canada caught in the crossfire and the country who ended up in this situation against its will, ended up paying as well. China arrested two Canadians, days after Meng’s initial arrest in 2018 and they still remain in jail.

When it comes to economic challenges, China made sure to deliver there as well. Soon after the detention took place, China banned Canadian crops and meat exports as a retaliation. It took a while for Canada’s economy to get back on track because the effect that the Chinese ban caused was actually quite substantial. 

Unpredictable outcome

Meanwhile the main culprit of this story, Ms. Meng spends their time painting and practicing her English, caring for flowers and enjoying some shopping here and there.

The court process will probably drag out for much longer than we can fathom. The first phase of the hearing will last probably a week.

Canada meanwhile is trying to get out of the situation without serious damage to its economy and its relationship with its partners which will be difficult if not impossible to do. 

But if the court hearing uses the argument, proposed put forward by Canada’s attorney general, stating that Ms. Meng’s conduct would also have been illegal in Canada since lying to HSBC could have put that bank’s financial interest at risk, the case might be harder to argue against for Huawei’s lawyers.

The case could take months, even years to come to an end considering that Huawei has pleaded not guilty of any accusations thrown at the company over the last two years.

After the initial case was brought to light, with the possibility that Huawei was using its devices to spy on other nations, to the allegation of trying to steal technology from T-mobile, Huawei hasn’t confessed to any of these allegations but despite that has had a very rough year in terms sales and is already dealing with enough problems.

While we can’t predict the outcome of the hearing we do know the basic arguments that both sides will be presenting so the outcome really could come in favor of China or the U.S.