Canada court grants bail to Huawei CFO; Trump might intervene

VANCOUVER/BEIJING (Reuters) – A top executive of Chinese telecoms giant Huawei Technologies Co Ltd wanted by the United States to answer to fraud accusations was granted C$10 million ($7.5 million) bail by a Canadian court on Tuesday, a move that could help soothe Chinese anger over her arrest.

Meng Wanzhou, 46, Huawei’s [HWT.UL] chief financial officer and the daughter of its founder, faces U.S. claims that she misled multinational banks about Iran-linked transactions, putting the banks at risk of violating U.S. sanctions.

In a court hearing in Vancouver, British Columbia, Justice William Ehrcke granted bail to Meng, who has been jailed since her arrest on Dec. 1. She will be subject to monitoring, a curfew and other conditions. If a Canadian judge rules the case against Meng is strong enough, Canada’s justice minister must next decide whether to extradite her.

U.S. President Donald Trump told Reuters on Tuesday he would intervene in the Justice Department’s case against Meng if it would serve national security interests or help close a trade deal with China.

The arrest of Meng has put a further dampener on Chinese relations with the United States and Canada at a time when tensions were already high over an ongoing trade war and U.S. accusations of Chinese spying.

China had threatened severe consequences unless Canada released Meng immediately. Analysts have said retaliation from Beijing over the arrest was likely.

The U.S. State Department is considering issuing a travel warning for its citizens, two sources said on Tuesday, while the Canadian government confirmed that one of its citizens in China had been detained.

Two sources told Reuters the person detained was former Canadian diplomat Michael Kovrig. The Canadian government said it saw no explicit link to the Huawei case.

However, Guy Saint-Jacques, Canada’s former ambassador to China, asked by the Canadian Broadcasting Corp whether the Kovrig detention was a coincidence, said: “In China there are no coincidences … If they want to send you a message they will send you a message.”

The Chinese embassy did not immediately reply to a request for comment.

Meng Wanzhou, Huawei Technologies Co Ltd’s chief financial officer (CFO), is seen in this undated handout photo obtained by Reuters December 6, 2018. Huawei/Handout via REUTERS

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Meng was detained as part of a U.S. investigation on Dec. 1 as she was changing planes in Vancouver. She has said she is innocent and will contest the allegations in the United States if she is extradited.

Tuesday was the third day of bail hearings. Meng’s defense had cited her longstanding ties to Canada, properties she owns in Vancouver and fears for her health while incarcerated.

Her family assured the court she would remain in Vancouver at one of her family houses in an affluent neighborhood if she was granted bail, according to court documents. Her husband said he plans to bring the couple’s daughter to Vancouver to attend school, and Meng had said she would be grateful for the chance to read a novel after years of working hard.

She must remain in Canada, include five guarantors on her bail and be subject to electronic monitoring and security when she leaves her residence.

The courtroom erupted in applause when the judge granted bail. Meng began crying and hugged her lawyers, before being ordered back into the prisoner box for more directions from the judge. She was ordered to reappear in court on Feb. 6 to make plans for further appearances.

Slideshow (13 Images)

Huawei, which makes smartphones and network equipment, said in a statement it looked forward to a “timely resolution” of the case.

“We have every confidence that the Canadian and U.S. legal systems will reach a just conclusion,” it said, adding that it complied with all laws and regulations where it operates.

Huawei is the world’s largest supplier of telecommunications network equipment and second-biggest maker of smartphones, with revenue of about $92 billion last year. Unlike other big Chinese technology firms, it does much of its business overseas.

Reporting by Julie Gordon in Vancouver; writing by Nick Zieminski and Rosalba O’Brien; additional reporting by Ben Blanchard and Michael Martina in Beijing, John Ruwitch in Shanghai and David Ljunggren in Ottawa; editing by Cynthia Osterman and Bill Rigby

Our Standards:The Thomson Reuters Trust Principles.

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