Huawei CFO Slams ‘Extraterritorial’ U.S. Extradition Request

Lawyers for Huawei Technologies Co.​’s chief financial officer told a Canadian court that the U.S. was illegally asserting extraterritorial jurisdiction by requesting Meng Wanzhou’s extradition on sanctions-related fraud charges in New York.

“There has never been a case, to our knowledge, where the court was confronted with a request that was itself contrary to international law,” defense lawyer Gib van Ert told a Supreme Court of British Columbia judge in a hearing on the U.S. request.

The high-profile proceedings -- at the heart of a dramatic diplomatic crisis between the U.S., China and Canada -- were triggered by the December 2018 arrest at Vancouver’s airport of Meng, the eldest daughter of Huawei’s billionaire founder. U.S. authorities seek the handover of the 49-year-old executive on fraud charges, accusing her of misleading banks into handling transactions for Huawei that violated American trade sanctions.

Huawei CFO Slams ‘Extraterritorial’ U.S. Extradition Request

A pillar of the U.S. case is a meeting between Meng and an HSBC Holding Plc banker that took place at a Hong Kong teahouse in August 2013. According to the U.S. indictment, her PowerPoint misrepresented Huawei’s operations in Iran, causing the bank to put itself at risk of sanctions violations. Meng denies the allegations.

‘China’s Concern’

Van Ert argued that because Meng is a Chinese national and the meeting took place in Hong Kong, a Chinese territory, the matter was beyond the reach of U.S. law.

“If any laws were broken that day, that is the concern of China, in whose territory the events occurred,” he said. “For the U.S. to apply its criminal law to Ms. Meng is contrary to the foundational principles of international law.” Canada would also be in breach of international law by assisting the U.S., he said.

The U.S. claims jurisdiction in part because the transactions that HSBC handled for Huawei were cleared through the U.S. dollar system. Prosecutors in the U.S. have frequently brought charges against foreign nationals based on their use of so-called “dollar clearing.”

Meng’s defense argued that wasn’t a valid basis for extending U.S. jurisdiction, saying that international law recognizes extraterritoriality only within narrow limits:

  • criminal acts by the country’s nationals abroad
  • acts by foreign nationals against the country’s citizens abroad
  • acts that endanger a country’s national security
  • internationally recognized crimes such as genocide
  • acts in a foreign country which cause substantial impact in the country bringing the charges

The U.S. case against Meng would only appear to fit the latter, van Ert said. Yet the transactions that HSBC handled for Huawei would’ve represented “very nearly zero” percent of the roughly $4.5 trillion cleared through the U.S. system daily -- hence, there was no substantial effect on the U.S. financial system and extraterritoriality is not justified, he said.

Historically, extraterritoriality is also sensitive issue in China, often linked to the country’s humiliation at the hands of 19th century imperialist powers. Under the treaties that followed China’s defeat in the Opium Wars, European and U.S. citizens in China were largely exempt from Chinese laws and could only be tried by their own nation’s tribunals.

The hearings on Meng’s extradition request are expected to continue until May. Appeals could lengthen the process significantly. Some Canadian extradition cases have lasted as long as a decade.

The U.S. case is U.S. v. Huawei Technologies Co., 18-cr-457, U.S. District Court, Eastern District of New York (Brooklyn).

©2021 Bloomberg L.P.

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