In an indication that the United States (US) is attempting to re-engage with China, on Thursday last week, a federal judge in Brooklyn dropped the indictment charge against Chinese telecom giant Huawei’s chief financial officer (CFO), Meng Wanzhou.
The move comes after Ren Zhengfei, Meng’s father and Huawei’s CEO, entered into a deferred agreement with American federal prosecutors last year wherein he called for the charges against her to be dismissed on 1 December 2022, which marks the four-year anniversary of her arrest in Vancouver on a US warrant.
As per the deal, the Department of Justice (DOJ) agreed to drop all charges against the CFO when the year-long deferral period ends, as long as she is not charged with a crime during that time.
Meng admitted to having made false statements during a 2013 meeting with a bank executive about her company’s ownership of Skycom, a Hong Kong-based communications firm.
Prosecutors alleged that Huawei was misusing the company to sell technological equipment to Iran, a move that violated US sanctions placed on Iran under the International Emergency Economic Powers Act.
Though Meng had initially claimed that the company was a partner of Huawei, she admitted in her agreement that it was “a wholly owned subsidiary.”
Her false statements were part of a statement of facts that she agreed were “accurate,” “voluntary,” and “would not contradict.” Any future contradiction or denial by Meng would place her in violation of the deal.
Brooklyn Attorney Carolyn Pokorny wrote in a letter addressed to US District Judge Ann Donnelly on 1 December that since there was no evidence that Meng had violated her end of the deal, “the government respectfully moves to dismiss the third superseding indictment in this case as to defendant Wanzhou Meng.”
Keeping this in mind, Donnelly dropped Meng’s remaining financial fraud charges on Friday “without prejudice,” which means that the case cannot be reopened in court.
“It is hereby ordered that the third superseding indictment in the above-captioned matter as to the defendant Wanzhou Meng is hereby dismissed with prejudice,” the district court judge wrote in her decision.
Meng was arrested in Vancouver in 2018 on a bank fraud warrant issued by the Trump administration and faced trial. American prosecutors claimed that Meng misled bankers at HSBC about Huawei’s relationship with SkyCom, putting the bank at risk of violating the US’ sanctions against Iran.
Wise decision: https://t.co/1Sf7TvPSQm
— Michael Kovrig (@MichaelKovrig) November 4, 2022
The CFO was released by Canada last September, after spending almost three years under house arrest in Vancouver. In turn, Beijing announced the release of detained Canadian entrepreneur Michael Spavor and former Canadian diplomat Michael Kovrig.
The move stirred debate in the Western media that China’s prompt release of the Canadian nationals was a retaliatory measure to Meng’s arrest. Canadian Prime Minister Justin Trudeau called Beijing’s retaliatory actions “coercive diplomacy.” However, Beijing denied allegations of “hostage diplomacy.”
In fact, following the dismissal of all remaining charges against her last week, Chinese state-owned news outlet Global Times (GT) said Meng was a “political hostage” of the US and Canada.
While Meng’s lawyer and Huawei’s public relations team have declined to comment on the latest development, GT remarked that with the conclusion of the case, the US had “made a fool out of Canada’s government.”
It noted that the case has dealt “irreparable” damage to China’s ties with both the US and Canada.
Even though the high-profile case has long strained China’s ties with the US and Canada, experts predict that its conclusion will not stop Washington from its ongoing crackdown on Chinese tech companies.
US formally ends shady case against Meng Wanzhou, makes a fool out of Canada.
— Zhang Heqing张和清 (@zhang_heqing) December 4, 2022
Source @globaltimesnews pic.twitter.com/VYhjhKKxes
While Meng’s name has been cleared of charges, her company continues to be embroiled in the case and will fight accusations of bank fraud, sanctions violations, economic espionage, and obstruction of justice in the US. The company has pleaded not guilty.
Washington has placed the Chinese tech giant on its trade-ban list, which prevents American suppliers from entering into business with the company.
Only last week, the country’s Federal Communications Commission (FCC) introduced new rules that ban American sales and imports of the new Huawei and ZTE equipment due to the “unacceptable risk” they pose to national security.
Washington has also accused the Chinese government of using its equipment for spying purposes.
Huawei’s case is pending trial in the District Court in Brooklyn, with no trial date set as of yet. A status conference on the matter will be held on February 7.
Although the case remains ongoing, the dismissal of charges against Meng could signal a softer approach against China’s “internal” affairs.
In a press briefing on Friday, US State Department spokesperson Ned Price said that the ongoing protests in China against the Communist Party’s stringent COVID-19 restrictions were “a question for PRC authorities.”
That being said, he added that “People in the PRC have a right, of course, to peacefully protest without fear. They have the same universal rights that people around the world have to freedom of assembly.”.
“We’ll continue to express our support for this fundamental freedom… as is freedom of the press, which we have also seen hindered during the course of these protests,” Price declared.
Price’s comments follow similar comments by White House Press Secretary Karine Jean-Pierre last week.
In reference to the report of a BBC journalist being assaulted and arrested while covering the protests, Jean-Pierre said that “No journalist should be arrested or beaten or harassed for simply doing their job.”
Meanwhile, China’s ties with Canada’ continue to grow even more strained.
Canada has summoned the Chinese Ambassador Cong Peiwu several times over the last few weeks to explain troubling reports of Beijing operating at least three illegal police stations in the country to monitor Chinese citizens.
Furthermore, last month, Trudeau warned China against playing “aggressive games” with democracies, as reports emerged of a sweeping campaign of foreign interference during Canada’s 2019 federal election.
China then retaliated by saying that it has “no interest in Canada’s internal affairs.”
In addition, Canada also released its new Indo-Pacific Strategy document last week, in which it describes China as an “increasingly disruptive global power” due to its “coercive diplomacy and non-market trade practices.”
Beijing retorted that Ottawa is the “true disruptive force to global peace, security, and development” and warned of ‘forceful countermeasures.’