VANCOUVER -- An extradition case against Huawei executive Meng Wanzhou is a test of whether courts will reject foreign charges that run contrary to Canadian values, argues her lawyer.
A British Columbia Supreme Court hearing wrapped Thursday that focused on the legal test of double criminality, or whether the conduct Meng is accused of would also be a crime in Canada.
The United States has charged her with fraud over allegations she lied to HSBC about Huawei's relationship with an Iran-based subsidiary, putting the bank at risk of violating American sanctions.
The defence has argued the judge must dismiss the case because Canada has rejected similar sanctions, while the Crown said the judge's job is to determine if there's evidence of fraud, not to uphold Canadian sovereignty.
Meng's lawyer, Richard Peck, responded to the Crown's argument by telling the judge that her interpretation of the law must be informed by values enshrined in the Constitution.
"This is the kind of case that tests our system," Peck said.
"It's a difficult case. It's not, for us, so much a matter of standing here and saying we want to see justice done. We say right needs to be done."
The concept of "right" is elusive, but it lies at the core of the rule of law, Peck said.
The risk faced by the bank from the alleged fraud is solely linked to American sanctions law, not the more traditional laws usually dealt with in extradition cases, he added.
"It's unique because the risk of economic deprivation arises solely from a legal obligation that exists in the U.S., which Canada has expressly repudiated," Peck said.
"It's unique because our standards have changed with respect to this very issue. It's extraordinary in that sense."
Canada lifted sanctions against Iran in 2016 after world powers signed a nuclear deal with the country. The United States withdrew from the deal in 2018 and imposed sanctions again while also adding new penalties. Canada has not followed suit.
If the judge rules Meng should be extradited to face charges, Justice Minister David Lametti will still have the final say on whether to surrender her to the United States.
Crown counsel Robert Frater said Wednesday the judge is responsible for evaluating the evidence, while the justice minister is meant to weigh issues of Canadian independence and values.
Frater also said the judge does not necessarily need to consider American sanctions law for the allegations to amount to fraud in Canada.
HSBC faced significant reputational risk for processing Iran-related transactions because it had already faced penalties for doing business in countries including Libya and Sudan, Frater said.
Another lawyer for Meng, Scott Fenton, countered Thursday that the Crown has previously argued that all the risk derived from violating American sanctions.
The Crown focused on sanctions risk, even when discussing reputational risk, in its arguments before a judge issuing an arrest warrant in 2018 and in court documents, he said.
Fenton said the Crown is now speculating that HSBC could have lost business relationships if it was revealed to be doing business with Iran, regardless of sanctions, and this marks a change.
"Milady, in my submission this is wrong. The court is being embarrassed," he said.
The Crown has also argued that the judge can, according to case law, consider the context of American sanctions in a limited way to understand the risk faced by HSBC.
Meng's arrest in December 2018 at Vancouver's airport set off a diplomatic uproar. Beijing has detained two Canadians and restricting some imports in moves widely viewed as retaliation.
She denies the allegations and is free on bail, living in one of her two multimillion-dollar homes in Vancouver.
Holmes reserved her decision after the defence concluded its reply Thursday.
If the judge rules the legal test of double criminality has not been met, Meng will be free to leave Canada. If she finds there is double criminality, the hearing will proceed to a second phase in June.
This report by The Canadian Press was first published Jan. 23, 2020.
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