Economy

Market Outlook: Huawei CFO arrested in Canada

Market Outlook: Huawei CFO arrested in Canada”

Canadian authorities have arrested China-based Huawei Technologies' chief financial officer for possible violations of us trade sanctions related to sales of HP equipment to Iran a decade ago.

Meng Wanzhou, who is also Huawei's deputy chair and is the daughter of founder Ren Zhengfei, was arrested in Vancouver in relation to suspicions of violations to United States sanctions against Iran.

A clerk at the B.C. Supreme Court said Meng appeared in court on Wednesday and a bail hearing is scheduled for Friday.

The statement said Meng sought, and was granted, a publication ban which prevents the department from releasing further details about the arrest. Huawei denies all charges.

Sources told Reuters in April that United States authorities have been probing 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 USA export and sanctions laws.

Though most Chinese people use their fathers' surnames, Ms Meng adopted her mother's family name. It has overtaken Sweden's Ericsson and Finland's Nokia to be the world's largest telecoms equipment maker by revenue. Combine Apple, Cisco, and Booz Allen, and then imagine this company working very closely with the USA government, and you get a better sense of the significance of the company to China.

Wanzhou has been arrested for allegedly attempting to evade newly-implemented USA sanctions that kicked in at the start of November. The company believes the Canadian and United States legal systems will ultimately reach a just conclusion.

The shock arrest of Meng Wanzhou, who is also Huawei Technologies Co Ltd's chief financial officer, is riling authorities in Beijing and raises fresh doubts over a 90-day truce on trade struck between Presidents Donald Trump and Xi Jinping on the day she was detained.

Both Huawei and ZTE Corp. have faced trouble with the USA and other governments over dealings with Iran and fears the Chinese companies' equipment might be used for spying.

Huawei is one of the world's largest telecommunications equipment and services providers.

A Chinese foreign ministry spokesman told reporters Thursday that government wants Canadian officials to reveal the reasoning behind Wanzhou's arrest.

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

In 2011, the American government stopped Huawei from purchasing USA server technology company 3Leaf's assets, for national security reasons. Security concerns have hampered Huawei's business in the U.S.as acquisitions were rejected and companies warned not to source network equipment from Huawei or ZTE.

The Global TImes also reported, in a news story, that Chinese experts view the arrest as an intentional effort to "heat up the ongoing trade war". Washington has previously raised concerns about the Chinese conglomerate because of its links to Beijing's government.

In a response, ZTE denied the charges while Huawei insisted it "posed no greater cybersecurity risk than any ICT [Information and Communications Technology] vendor".



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