Huawei CFO arrest for US sanction violations plunges shares

Asian shares have plunged following the arrest of Huawei’s CFO in Canada for the alleged violation of US sanctions against Iran.

Those hoping the G20 summit would ease trade tensions between the US and China had them dashed by the news. Traders hoped the ceasefire announced by President Trump after meeting his Chinese counterpart at the G20 summit would lead to more stability.

Huawei CFO Meng Wanzhou was arrested by Canadian authorities in Vancouver and is currently facing extradition to the US. The allegation is she violated US sanctions against Iran, though a publication ban is preventing further details being released.

Wanzhou is the daughter of Huawei founder Ren Zhengfei making the arrest particularly notable. Huawei has often come under scrutiny for Zhengfei’s past links to the People’s Liberation Army, where he served in a rank equivalent to a major.

These past links have often been cited as a reason for some Western governments to ban the use of Huawei network equipment. The US has always enforced a ban, while Australia notably banned the company from 5G networks earlier this year.

In recent weeks, the US has ramped up petitioning of its allies to ban Chinese 5G equipment from their networks. New Zealand, a ‘Five Eyes’ security partner of the US, blocked a telco from using Huawei’s gear in the days following the reports.

Here in the UK, BT/EE said it will be stripping Huawei equipment from its 4G network by 2021 and will not be using the vendor for their 5G core. "Huawei remains an important equipment provider outside the core network, and a valued innovation partner," a BT spokesperson said in a statement.

South Korea’s largest carrier, SK Telecom, left Huawei off the list of 5G vendors it will be using for its network. Huawei was also forced to deny the Indian government has excluded it for nationwide 5G networks.

A bail hearing for Ms Meng has been set for Friday.

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