Meng Wanzhou, the financial director (CFO) of Huawei and the daughter of the company's founder, arrested ten days ago in Vancouver, Canada, has applied to be released pending the hearing that will have to decide on her extradition to the United States. . The request was made on Monday 10 December in front of a judge, who decided the next day to give Meng bail. Meng's legal affair is closely linked to the so-called “trade war” between China and the United States, initiated by US President Donald Trump: it is leading to new major diplomatic tensions and could have repercussions in the technology sector.
During Monday's hearing, Meng's lawyers explained that their client is not in good health and that, once released, she would still remain in Vancouver with no risk of fleeing. The lawyers also outlined a rather detailed proposal to ensure that Meng stays in Canada: she would live confined in one of her two houses in Vancouver under the control of her husband, offer multi-million dollar collateral and real estate, would be willing to wear a electronic bracelet and to be monitored by a private security and surveillance company, at his expense. Bail has 15 provisions that Meng will have to abide by: he will have to, among other things, undergo constant surveillance, wear the electronic bracelet, deliver both of his passports, and provide a $ 10 million guarantee.
Meng was arrested on 1 December at Vancouver airport, while she was making a stopover on a trip from Hong Kong to Mexico. The arrest was carried out by Canadian police at the request of the United States, which accuse Meng of having participated in certain activities for the sale of products to Iran, violating US sanctions.
The arrest took place at the same time as Trump was meeting with the Chinese president, Xi Jinping, as part of the recent G20 organized in Argentina. During the meeting, the two presidents had agreed on a kind of truce in the trade war, with the aim of finding a more stable agreement within 90 days. The Meng affair could complicate the negotiations, even if for now the Chinese government has tried to keep the Huawei issue out of comparison.
However, the Chinese government has criticized the US extradition request, threatening consequences for Canada as well. The ambassadors of the two countries in Beijing were summoned by the Chinese authorities, who expressed their disapproval of the arrest. Meng's arrest has been defined by the Chinese government as a “violation of human rights”, a definition that has raised some perplexity and irony on the part of numerous observers. The Chinese government systematically violates the civil and human rights of its opponents, represses many forms of political dissent and routinely censors the media.
Meng is accused of lying to US financial authorities in 2013, when she claimed that Huawei had nothing to do with Skycom, a Hong Kong company that the US claims had sold products to Iran, violating sanctions. Meng's lawyers have been rejecting this version for days, arguing that Skycom was sold by Huawei as early as 2009 and therefore there could be no links to the fraudulent activities.
Huawei is China's largest privately held technology company. Founded in 1987 by Ren Zhengfei, Meng's father and former army officer, it has grown enormously in the past two years both in the manufacturing of telecommunications systems and in smartphones for individual consumers, which has led to greater fame especially in the West. Thanks to good quality products and very low prices, with the renunciation of producing high margins, Huawei this year surpassed Apple in production volumes, becoming the second largest smartphone manufacturer after Samsung.
Despite its size, Huawei continues to be a less popular brand in the United States, also due to the limitations imposed by the government and Congress. The company is considered unreliable and at risk because through its tools it could steal intelligence information and trade secrets, to be reused or resold in China, the US authorities believe. Something similar happened this year also with ZTE, another large company with ties to the Chinese government.
Major intelligence agencies have been very suspicious of Huawei for some time. Apart from Canada, four other countries that collaborate a lot with each other for sharing intelligence information (United States, United Kingdom, Australia and New Zealand) have decided to ban Huawei for the construction of future 5G networks, the new evolution of cellular telecommunications systems, supporting potential national security threats. In Japan, a new measure recently banned both Huawei and ZTE from public contracts, and the country's top three private telecommunications companies are expected to do so soon.
Huawei denies any involvement in fraudulent activity and claims that Meng's arrest is motivated by simple political calculations. The affair has led to further mistrust between the United States and China in the competitive and booming sector of telecommunications systems and consumer products such as smartphones. Some large US companies fear that there may be reprisals from China, with the arrest of their managers who are abroad. News circulated about an email sent by the US Cisco to its employees, in which it was advised not to reach China. Cisco then debunked the news, claiming to have sent the email by mistake, but the concerns are still shared by several other large companies.
Meanwhile, in China, the main government-controlled media are spared no criticism of the United States. The Global Times, one of the most widely read newspapers, says that Meng's arrest will lead Americans to increasingly isolate themselves from the opportunities of the digital economy, leaving his future in the hands of other countries, such as China.
