Huawei executive Meng attends bail hearing at Canadian court

VANCOUVER (Reuters) – Chinese telecommunications giant Huawei Technologies Co Ltd Chief Financial Officer Meng Wanzhou appeared in a Canadian court on Tuesday for a hearing concerning her bail in a case that has strained Beijing’s ties with Canada and the United States.

Meng, the daughter of Huawei’s founder, attended the hearing in British Columbia Supreme Court in which Justice William Ehrcke approved her request for a change in who is financially responsible for her bail.

Ehrcke on Dec. 11 approved Meng’s release on C$10 million ($7.5 million) bail, and she has stayed at a family residence in Vancouver.

Canada arrested Meng on Dec. 1 as she was changing planes in Vancouver, at the request of the United States, which on Monday brought sweeping charges against Huawei and Meng that paint the company as a threat to U.S. national security. Meng was charged with bank and wire fraud to violate American sanctions against Iran.

The Canadian government agreed on Tuesday to her request concerning bail at the hearing, which the judge granted. Ercke also pushed back Meng’s next scheduled court appearance by a month, to March 6.

Before the hearing, Meng spoke with her lawyer David Martin, holding a notepad and wearing a black shirt and pants.

She is fighting extradition to the United States. Following her arrest last month, China arrested two Canadians on national security grounds.

Her arrest further aggravated U.S.-Chinese tensions at a time when the world’s two largest economies are locked in a trade war. U.S. President Donald Trump said in December that he could intervene in Meng’s case if it would serve national security interests or help close a trade deal with China.

In Ottawa, Public Safety Minister Ralph Goodale said the Canadian government’s decision on whether to ban Huawei from supplying equipment to 5G networks is “some ways off into the future.”

Goodale’s comments were the most specific indication yet from Ottawa on the timing of a politically sensitive announcement. Officials are studying the security implications of 5G networks, the latest generation of cellular mobile communications. The United States and other Canadian allies have already imposed restrictions on Huawei equipment, citing the risk of espionage.

Huawei is the world’s largest supplier of telecommunications network equipment and second-biggest maker of smartphones. It derives nearly half of its total revenue outside China.

In her December bail hearing, Meng argued she should be released on bail, citing her longstanding ties to Canada, properties she owns in Vancouver and fears for her health while incarcerated.

    In a sworn affidavit, Meng said she is innocent and will contest the allegations at trial in the United States if she is extradited. Meng said she was taken to a hospital for treatment for high blood pressure after being detained. She cited that condition in a bail application seeking her release pending an extradition hearing.

U.S. Treasury Secretary Steve Mnuchin said on Tuesday he expected significant progress in Washington trade talks with Chinese officials set for Wednesday and Thursday. Mnuchin said the U.S. security concerns raised by the Huawei case were separate from the trade issue.

China’s foreign ministry has urged the United States to drop the arrest warrant and end “unreasonable suppression” of Chinese companies. China has demanded her immediate release.

Huawei’s global reach has come under attack from the United States, which is trying to prevent U.S. companies from buying Huawei equipment and is pressing allies to do the same. U.S. security experts are worried the gear could be used by China’s government for espionage, a concern Huawei calls unfounded.

U.S. intelligence and national security officials expressed fresh national security concerns about Huawei during a U.S. Senate committee hearing in Washington on Tuesday.

FBI Director Christopher Wray told lawmakers the lines between “the Chinese government and ostensibly private companies” are blurred if not totally erased and “especially the lines between lawful behavior and fair competition and lying and hacking and cheating and stealing.”