Huawei today turned to the British courts in its fight to keep CFO Meng Wanzhou out of American prosecutors’ hands.
The Chinese super-corp invoked a law from 1879 at the High Court in London, England, to get its hands on a HSBC UK Powerpoint presentation it argued will help the chief beancounter escape extradition.
Wanzhou, daughter of Huawei founder Ren Zhengfei, is right now in Canada trying to stave off an attempt by the United States to extradite her to the Land of the Free. Huawei claims Uncle Sam's lawyers lied to the Canadian courts by filing a “manifestly unreliable” list of allegations against her when applying for extradition, and as such the whole thing should be thrown out.
Frowning at today’s legal submissions, Mr Justice Fordham asked Huawei’s barrister James Lewis QC: “Is this correct: the purpose of this application before me today is to get information held by the US authorities provided to the defendants… but to get it from HSBC’s UK entities so as to be able to rely on it in the extradition proceedings. Is that broadly right?”
“Broadly right, my lord,” Lewis told the High Court, describing the novel application as “simply a different route which is permissible.”
The case comes as Wanzhou’s extradition hearings in Canada, listed for March and April, draw closer – and are also set against the backdrop of tense relations between America and China.
So who claims what?
The US says Wanzhou breached American sanctions against Iran by misleading HSBC over Huawei’s relationship with a company called Skycom Tech Co Ltd.
Skycom, which was allegedly “controlled” by Huawei and had Wanzhou as a board member, is accused of selling $1.3m in Hewlett Packard IT gear to Iran in the late 2000s – and, at the same time, served as a funnel for around $100m of sanctions-busting financial transactions.
That was why Wanzhou was arrested on a US extradition warrant: the Americans say she was part of the sanctions-smashing effort and also committed fraud by lying about it to HSBC so the bank would process the transactions. Reuters reported in 2019 that an internal HSBC probe exposed Wanzhou’s links to Skycom, triggering the US criminal investigation.
Wanzhou and Huawei deny all and any wrongdoing over Skycom and breaching US sanctions.
Today in court
Proof that the Huawei CFO was not misleading the US, Huawei claimed today in the High Court, was to be found in a Powerpoint presentation she gave in 2013 to Alan Thomas. At the time he was HSBC’s deputy head of global banking.
Huawei hopes the High Court will let it use a law dating back to May 1879, section seven of the Bankers’ Books Evidence Act (BBEA), to seize copies of internal HSBC correspondence based on the presentation. That, it claimed, will allow it to show in Canada that Wanzhou was wrongly arrested and ought to be freed.
Lewis, barrister for Huawei, told Mr Justice Fordham in written arguments today: “The reliance or otherwise by HSBC decision-makers on what was said in the presentation, both about the relationships between Huawei and Skycom and about Huawei’s sanctions compliance procedures, is fundamental to the question whether any fraud by false representation can be alleged.”
HSBC urged the judge to throw out the application, with its barrister Rupert Allen saying in written submissions Huawei had got the law wrong. The BBEA, he said, was about “records of banking transactions” and not internal correspondence.
Huawei to the danger zone: Now Uncle Sam slaps it with 16 charges of racketeering, fraud, money laundering, theft of robot arm and source codeREAD MORE
“Indeed, the Applicant does not appear to be interested in any records of banking transactions per se,” he wrote, “but instead seeks evidence of internal deliberations within the HSBC Group about the propriety of certain transactions or customers and/or the connections between different customers. This is a million miles away from the disclosure of entries in ledgers, day books, cash books and account books.”
Section seven of the BBEA itself says “a court or judge may order that such party be at liberty to inspect and take copies of any entries in a banker’s book” for the purposes of court proceedings. Huawei hopes Mr Justice Fordham rules that this applies to any court case anywhere in the world and not just legal challenges in old Blighty.
Later, the judge asked Lewis to summarize Huawei’s case again, saying: “But the position in Canada, as your witness explains and then tells me it would be the same in England, [is that] these materials are not discoverable from the requesting party to the requested person for the purpose of fairness of extradition proceedings, including the abuse of process argument. Is that right?”
The judge was asking, was Huawei trying to sidestep Canadian law by obtaining documents in England that it wasn’t allowed to get hold of in Canada – and did the law here allow that?
“My lord, almost,” replied Lewis. “It’s a little more nuanced than that.”
Proceedings ended with Mr Justice Fordham saying: “I want to reflect on what I’ve heard and I want to do some further reading,” adding: “I think it’s important that we get this judgment handed down as soon as I’m realistically able to provide it.” ®