U.S. claims jurisdiction over Chinese biz exec

Meng Wenzhou, chief financial officer of Huawei, a giant Chinese telecommunications company, was arrested while passing through Vancouver on charges related to U.S. economic sanctions against Iran.

Meng Wenzhou

She is the daughter of Ren Zhengfei, the company’s founder.

She reportedly is accused of concealing the fact that a company called Skycom, which does business with Iran, is a subsidiary of Huawei, and thereby causing Huawei clients to unknowingly violate U.S. sanctions against Iran.

In other words, a foreign business executive has been arrested on foreign soil for breaking U.S. domestic law.  This is a power grab that the U.S. would not tolerate if a foreign government did it to a U.S. executive.

It is a slap in the face at China as a time when Presidents Trump and Xi were trying to resolve trade disputes.  It could raise hostilities between China and the U.S. to a new level.

I can think of four possible explanations for the U.S. action, all of them bad—

  1. President Trump arranged this deliberately as a way of putting pressure on President Xi.
  2. President Trump knew about the charges, but didn’t think they would affect trade negotiations.
  3. American officials proceeded without notifying President Trump because they didn’t understand the significance of their actions.
  4. American officials proceeding without notifying President Trump because they saw Huawei as a security threat or wanted to undermine the Trump-Xi negotiations.

Huawei sells telecommunications equipment and networks.  It reportedly has more than 180,000 employees and does business in more than 100 countries.  It is reportedly the world’s second largest manufacturer of smartphones.

Many Western countries and companies in recent months have stopped doing business with Huawei and ZTE, another Chinese telecom company, because they fear their equipment could be used for cyber-espionage by the Chinese government.  I think that is a reasonable fear.  The arrest of Ms. Meng is not reasonable.

LINKS

The War on Huawei by Jeffrey Sachs for Project Syndicate.

How Huawei’s CFO ended up in a jail in Canada by Julia Horowitz for CNN Business.

What’s going on with Huawei? by BBC News.

Meng’s arrest could plunge US, China into high-tech Cold War by Gordon Watts for Asia Times.

Huawei’s amazing global rise shrouded in controversy by Gordon Watts for Asia Times.

How Meng Wanzhou’s Arrest Might Backfire by Tyler Cowen for Bloomberg Opinion.

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One Response to “U.S. claims jurisdiction over Chinese biz exec”

  1. Fred Says:

    But it was the Canadians who did it. And Trudeau is neither hot-headed, stupid, nor Washington’s lap dog. Something very strange going on here.

    Like

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