On May 27, Chief Justice Heather Holmes of the British Columbia Supreme Court – the provincial high court – issued its decision in the case United States v. Meng. Holmes concluded that the “double criminality requirement for extradition” – which states that the alleged violation must be a criminal offense both in the state requesting extradition and in Canada – “is capable of being met in this case.” Holmes therefore rejected Meng Wanzhou’s request for “an order to expel him from the extradition process.”
Facts of the Case
Canadian authorities arrested Meng December 5, 2018, in Vancouver. She is the chief financial officer of Chinese telecommunications company Huawei, as well as the daughter of its founder and CEO, Ren Zhengfei. As Holmes explain, the United States allegation – which is “not proven but must be considered true for the purpose of this application” – is that Meng deliberately misled HSBC executives about the level and nature of Huawei’s operations in Iran. Because of the US sanctions regime against Iran, US federal regulations require “banks to obtain authorization … before providing financial or credit services through the US to entities in Iran.” HSBC, which served Huawei at the time, had “collided” with U.S. sanctions. and thus has signed a pending prosecution agreement “with the US Department of Justice … in which he agreed not to violate further sanctions.”
In 2012, Reuters revealed that Skycom Tech Co. Ltd., an Iranian-based company with a “close relationship” with Huawei, has violated U.S. sanctions. Skycom offers to sell at least “1.3 million euros embargo … computer equipment to Iran’s largest mobile phone operator.” Reuters writing clearly worries HSBC executives and banks right “Making questions from Huawei about the report.” The US alleged that Meng, who had served on the Skycom board, misinterpreted the relationship between Huawei and Skycom on August 22, 2013, a private meeting with HSBC in Hong Kong and thus “put HSBC at risk of fines and penalties … for new violations of US sanctions. “
The May 27 ruling focuses on the dual criminal law doctrine. As the Supreme Court of Canada write in M.M. v. United States of America, “[W]here a person is extradited to commit an act that is not a criminal offense in the requested country, the principle of criminal double offense. “In this case, the relevant question is whether” alleged Meng’s behavior, if it had happened in Canada, would have meant fraud that contradicted … Criminal Code. “Holmes note down that fraud in Canada “requires dishonest behavior with appropriate appropriation” and that the appropriation “does not have to be actual economic losses, but can consist of potential losses.”
Meng’s main argument is that the alleged action cannot mean fraud because Canada does not have a sanctions regime against Iran that is similar to the United States. Namely, because “Canada has no law … preventing banks from doing business with entities based in Iran … [n]o Deprivation could arise “from alleged misrepresentation of Meng if he made it to a bank in Canada.
The Canadian Attorney General responded with two arguments: First, deprivation “can be carried out without relying on US sanctions and their effects” and, second, the court can “properly consider US sanctions as part of a background of foreign law whose important behavior must be understood.” Holmes refused the attorney general’s first argument. But he accepted the second argument, writing that “the accusation depends on the effect of US sanctions.” Holmes disagrees with Meng’s opinion that it is inappropriate to refer to US sanctions, writing: “Canadian fraud laws look beyond international boundaries to cover all relevant details that form a factual matrix, including foreign laws that can give meaning to several countries facts. “In this case, a reference to US sanctions is “necessary to explain how HSBC is at risk.”
Holmes thus stated that the court was justified in considering the impact of U.S. sanctions. “As part of the background … towards which the alleged behavior was examined.” After considering this effect, Holmes concluded that “as a legal matter, the double criminality requirements for extradition can be met in this case.”
The Chinese media has reacted aggressively to court decisions. A few days before the verdict, Meng, accompanied by friends and family, regulated photo shoot in front of the Supreme Court of British Columbia, in what CBC News called “a round of premature victory.” The Global Times, a media group managed by the Chinese government, run the optimistic part entitled “Meng Huawei is likely to be released if Canada has judicial independence.” The article gathered a number of legal experts, who expressed hope that Meng would be free.
Then the May 27 decision came. Global Times soon was published an article that called the ruling “unjustified.” Interviewed sources stated that the ruling “would make Canada a sad clown and scapegoat in the fight between China and the United States.” A spokesman for the Chinese Ministry of Foreign Affairs sue that Canada “immediately corrected his mistakes, released Meng and made sure he returned safely to China.”
Meng Meng’s case was far from over. The second phase of the trial – dealing with Meng application to remain in the extradition process on the basis of abuse of the process-will start in the month of June. If the court does Meng for extradition, the minister of justice must make a final decision whether to extradite him to the U.S. Meanwhile, Michael Kovrig and Michael Spavor – two Canadians who were seized and demanded by the Chinese government arbitrarily in response to Meng’s arrest – will continue to languish in Chinese prisons when Beijing retaliates the decision.
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