Note: This is a revision of an earlier version. For more details, see the note at the bottom of the article.
Given the narrow margin of Joe Biden’s election victory in several key battleground states, many are paying closer attention to the key procedural milestones in the timeline leading up to the January 20 inauguration date, after which the traditional “first 100 days” of the new US administration will commence.
In China there are other overlapping dates that people are also focused on that may have an important continuing impact on the Sino-US relationship. A key date passed just last week: December 1 marked the second anniversary of the arrest of Meng Wanzhou.
Meng, who is the chief financial officer of Chinese telecommunications giant Huawei Technologies Co, and the daughter of Huawei founder Ren Zhengfei, was arrested at Vancouver International Airport on December 1, 2018, by Canadian authorities acting at the behest of the US Department of Justice (DOJ).
She remains under house arrest as she fights extradition to the US. Hearings in the case are expected to extend into the spring of next year. If the Canadian court approves her extradition, appeals could drag on for years before she ever appears in a US court.
Biden’s election introduces a few potential complications into Meng’s case. First, her lawyers have accused President Donald Trump of using her as a bargaining chip in the then-pending US-China trade negotiations.
There are indications that, in fact, Trump was caught by surprise by Meng’s arrest, but it also appears that he did see her case as being part of the basket of issues to be addressed in the mix of the ongoing negotiations.
However, in the wake of the economic and political fallout from the Covid-19 pandemic, all further trade negotiations with China had already been shelved with no sign of restarting. Consequently, even if Trump had been re-elected, it is not clear that there was anything left to negotiate.
From that perspective, Meng’s value as a bargaining chip had already diminished. With Trump out of office, this argument may need to be revisited entirely.
No sanctions, no case?
Second, the charges against Meng stem from alleged violations of Iran sanctions laws and related alleged misstatements made by Meng to HSBC representatives about Huawei’s activities in Iran. US prosecutors charge that this constitutes bank fraud.
But with Biden widely expected to reinstitute the Iran nuclear deal, will a prosecution that is based on violations of Iran sanctions, which were first imposed under president Jimmy Carter and then dismantled under Barack Obama and his vice-president Joe Biden, then reimposed by Trump, and now presumably to be removed again under the incoming Biden administration, remain as important to Biden’s DOJ, particularly in the context of the broader US-China relationship?
This brings us to a third point. One key complaint about Trump was his penchant for apparent political interference in criminal prosecutions. However, in this case, the independent judicial process may not achieve a result that will make all sides happy.
The Canadian court handed Meng a small but important procedural victory at the end of October, allowing a third prong or branch of her claim of abuse of process to proceed to hearing and allowing her lawyers to adduce additional evidence in support of those claims (although not to the full extent requested by Meng).
In making that ruling, the court found that Meng’s lawyers’ argument met the “air of reality” test, which admittedly is a low bar. This allows her lawyers to bolster their case for the final hearing at which the court will determine whether or not to grant extradition.
However, persuading the court to deny the US extradition request is another matter entirely, so the outcome remains uncertain.
China reportedly (and understandably) hopes and expects that the Canadian court will deny extradition to the US. For China, this has always been seen as a political prosecution. In addition, Chinese observers have been encouraged by the arguments advanced by Meng’s counsel and the interim – albeit limited – successes in the court proceedings so far.
If the court ultimately rules against Meng, in China the initial shock at her arrest will likely turn to outrage, casting an even greater pall on the tripartite Sino-US-Canadian relationship.
The most recent phase of the proceedings against Meng came of hearings on claims of abuse of process in connection with her arrest. During the four weeks of testimony that were recently concluded, Meng’s counsel was able to adduce some dramatic evidence to support their defense claims.
When Meng landed in Vancouver for a brief stopover while she changed planes to fly to Mexico, she was referred to “secondary” screening by Canadian Border Services Agency (CBSA) officers. She was not told that she was under arrest or that an arrest warrant had been issued. She also was not advised of her rights.
Even so, her baggage was searched and she was questioned by the CBSA officers about Huawei’s operations around the world.
According to the testimony of one of the Canadian police officers involved in Meng’s arrest, at the request of US authorities her electronic devices were confiscated, and she was compelled to provide the passcodes. It was more than two and a half hours after she was first detained that she was informed that she was under arrest and advised of her rights.
US authorities reportedly had attempted to persuade nine other countries to arrest Meng and hold her for extradition before Canadian officials finally agreed to cooperate. According to handwritten notes of an internal CBSA meeting prior to Meng’s detention and arrest, CBSA officers were not to suggest that the Royal Canadian Mounted Police (RCMP) were involved.
The most dramatic development in the recently concluded hearing phase was the refusal of retired RCMP staff sergeant Ben Chang to appear to testify in the case. Chang reputedly had been in communication with the FBI during the time of Meng’s detention and later formal arrest. Further reports indicate that Chang, who took a position with a casino in Macau after his retirement from the RCMP in 2019, had retained legal counsel in connection with the inquiry.
Moreover, there was conflicting testimony as to whether Roslyn MacVicar, the Pacific regional director general of the CBSA at the time of Meng’s arrest, had directed CBSA officers not to create additional file records in Meng’s case so as to avoid potential public disclosure under Canada’s access-to-information and privacy laws.
In her testimony, MacVicar denied the claims, but this was contradicted by statements from two subordinates, and the final agreed statement of the facts read out at the conclusion of this phase of the proceedings by John Gibb-Carsley, the Canadian government lawyer in the case, appeared to acknowledge that MacVicar had in fact given such an instruction.
To critics, this smacks of a cover-up and suggests that Meng’s initial detention by CBSA officers may have been part of a coordinated effort to secure evidence that would otherwise be inaccessible to law enforcement.
In China the case is seen as an example of selective application by the US and other Western countries of the concept of the rule of law. Even some Canadian legal experts have called on the justice minister to intervene in the case in order to reinforce international perceptions of Canada as a country that adheres to the rule of law.
In a formal legal opinion reportedly submitted to the minister of justice this June, Toronto lawyer Brian Greenspan, who is well versed in Canadian extradition law, citing what he termed to be a “weak and speculative” case against Meng, argued that there are “compelling reasons” for the minister to intervene now and not wait until the current process is completed.
The purpose, Greenspan wrote, of such an intervention would be “to preserve, if not enhance, Canada’s long-standing commitment both to comity and our adherence to principles of fundamental justice in the international arena.”
Greenspan’s legal opinion was sought by former federal justice minister Allan Rock, who noted that an extradition proceeding “has a political aspect to it and the minister of justice controls the process under the Extradition Act. He can turn it on. He can turn it off.” According to Rock, the prime minister would be entirely within his rights to speak with the justice minister about the case.
The recently concluded hearings on the abuse-of-process claims relating to Meng’s arrest will have only reinforced such views on the part of those supporting such a course of action.
Canadians also are marking a second anniversary. Two Canadian nationals, Michael Kovrig, a former diplomat, and Michael Spavor, a businessman, were detained in China on December 10, 2018, and later charged with “spying on national secrets” and providing intelligence for “outside entities.”
Canadian officials described their arrests as “arbitrary,” but China denied that the arrests of the two Canadians were in retaliation for or otherwise connected to Meng’s detention in Canada.
Many Canadians would prefer for Meng to win her extradition fight if that would mean that the “two Michaels” could be released as well. Some even suggest that Canada “make a deal” for a de facto swap. (This also appears to be the intention of Allan Rock, who reportedly sought the legal opinion referenced above together with the wife of one of the Canadian detainees.)
This is a politically sensitive issue in Canada. When the Canadian ambassador to China, John Macallum, publicly opined shortly after Meng’s arrest that it would “not be a happy outcome” if she were extradited, but that it would be “great” if a swap could be made for the two Michaels, he was unceremoniously fired.
But a year later, Prime Minister Justin Trudeau in essence said the same thing – the US should not agree to a final deal with China that did not resolve the cases involving Meng and the two detained Canadians.
A realpolitik solution?
This suggests that many, including many in high positions, are willing to entertain the possibility of direct political interference in the judicial process at this stage. The legal opinion sought and promoted by former Rock in essence proposes a similar approach – reinforce the concept of the rule of law by looking beyond the law to the broader considerations of international relations with China.
This suggests that many, including many in high positions, are willing to entertain the possibility that there was political interference in the judicial process. The AmChamUS white paper in essence proposes a similar approach – reinforce the concept of the rule of law by looking beyond the law to the broader considerations of international relations with China.
Trump was excoriated for such talk, and his loose rhetoric in this regard forms part of the claims of abuse of process raised by Meng’s lawyers.
But it may also be an example of realpolitik.
The challenge for Biden is that he was elected primarily because he was not Trump. Republicans down-ballot overall fared much better than Trump, and even then Trump narrowly lost in a handful of key swing states, handing the Electoral College victory to Biden by the same margin as Trump beat Hillary Clinton in 2016.
Ironically, Trump may have provided a template for how to resolve the current dilemma facing Biden in how he handled the ZTE case in 2018. When ZTE failed to comply with the terms of a prior plea deal arising from violations of US sanctions on Iran and North Korea, it was slapped with a seven-year ban on purchases of US-origin technology, amounting to a corporate “death penalty.”
Trump stepped in and negotiated a new deal that called for the firing of senior directors, the payment of more than $1 billion in fines and the imposition of a comprehensive compliance system under the management and supervision of a US-appointed independent monitor.
In exchange, ZTE was allowed to resume purchases of US technology essential to its operations. In short, it survived because Trump intervened in a matter involving both regulatory and criminal aspects.
But can Biden take the realpolitik option, follow the Trump template, interfere in the pending criminal case, and still claim the moral high ground as the anti-Trump?
On the other hand, is his administration willing to risk a further serious deterioration in the US-China relationship in order to uphold the rule of law as a matter of principle untainted by geopolitical considerations?
If Biden opts for Door Number 1, he will likely best be served by waiting for Meng’s extradition case in Canada to proceed to its conclusion and be decided by the judge strictly in accordance with applicable law. If based on the law and the facts the court decides that Meng should be extradited, then the Biden administration can use back channels to find a discreet offramp.
The overall contours of such a deal could be similar to the ZTE deal but with the added dimension that Meng and the two Michaels plead to agreed lesser charges and are sentenced to time served.
In fact, The Wall Street Journal reported on December 3 that the DOJ has quietly offered such a plea deal to Meng – plead guilty and go home. Others are reporting that Meng is reluctant to admit guilt and is seeking a deferred prosecution agreement (DPA) instead. This would still involve her signing off on an agreed set of facts outlining the wrongdoing but would avoid a formal conviction so long as she adhered to the terms of the deal.
A similar plea deal or DPA based on the ZTE framework would have to be worked out separately for the Huawei entities which face related criminal charges.
Such a deal would need to be structured to be implemented with sufficient intervening intervals of time so as to provide all sides with plausible deniability.
If Biden takes this option, he can still be the anti-Trump. There was no outrage in the US when Trump cut the ZTE deal. No one complained that he interfered in pending administrative and criminal actions to further his political objective of striking a trade deal with China.
In this case, few people in the US know who Meng is. As long as the DOJ can report that an arrangement similar to the ZTE deal was reached with Huawei, no one will care about the plea deal with Meng in her personal capacity.
All Biden has to do to be the anti-Trump is to be discreet.
Note: The original version of this article was revised to include updates from the recently concluded hearings in the extradition proceedings relating to claims of abuse of process in connection with Meng’s arrest. That earlier version also included references to a white paper purportedly issued by the American Chamber of Commerce in the US. Because the veracity of that white paper could not be verified, such references were removed and replaced by reports on the Greenspan legal opinion to a similar effect.