Case against Huawei CFO for fraud will go forward in June, Canada judge rules

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A judge in Canada ruled on Wednesday in favor of the U.S. as it attempts to extradite the daughter of Huawei founder, Meng Wanzhou, for fraud charges.

The decision to allow the case to go forward could further fray relations with the two western countries as Huawei has been the target of America in its trade battle with China.

HUAWEI: CHINA WILL HIT BACK AT NEW US TRADE RESTRICTIONS

The U.S. accuses Huawei -- the world’s largest telecommunication supplier -- of using a Hong Kong shell company to sell equipment to Iran in violation of U.S. sanctions. It says Meng, 48, committed fraud by misleading the HSBC bank about the company’s business dealings in Iran.

Associate Chief Justice Heather Holmes said the allegations against Meng in the U.S. constitute as “double criminality,” as it is also a crime in Canada and the extradition could therefore proceed.

Meng’s lawyers argued during a hearing in January that the case is not a fraud case but is instead about U.S. sanctions against Iran. The lawyers maintained that since Canada does not have similar sanctions against Iran, no fraud had occurred under its laws.

“Ms. Meng’s approach to the double criminality analysis would seriously limit Canada’s ability to fulfill its international obligations in the extradition context for fraud and other economic crimes," Holmes wrote in her decision.

Holmes said Canada did not have economic sanctions against Iran at the time but noted the sanctions used by the U.S. “were not fundamentally contrary to Canadian values."

The U.S.' scrutiny of Huawei centers on the company's efforts to build telecommunication networks that may be harmful to national security and has accused them of spying.

The Trump administration attempted to block material shipments to Huawei by adding the company to a blacklist, which prevents American companies from doing business with them, and the trade restrictions have set off a tariff war with Beijing that has been brewing since 2018.

China has demanded Meng be released to no avail and Huawei called Wednesday's ruling "disappointing." Meng is due back in a Canadian court on June 15.

Meng was arrested by Canadian authorities at Vancouver’s airport in late 2018. Her attorneys have argued that Canada Border Services, the Royal Canadian Mounted Police and the FBI violated Meng’s rights while collecting evidence before she was actually arrested.

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The Associated Press contributed to this report.