Bill Kelly: Was Huawei arrest a set up?

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Now that Huawei CFO Meng Wanzhou has been released on bail in Vancouver - a common sense decision that reflects her health concerns and bona fides - attention will turn to next steps in the case involving U.S. allegations against her.

The two Canadians, Michael Kovrig, a former diplomat in China, and Michael Spavor, an entrepreneur who lived in northeastern China near the North Korean border, were taken into custody Monday on suspicion of "engaging in activities that endanger the national security" of China, Chinese foreign ministry spokesman Lu Kang said.

Following Meng's December 1 arrest, which the USA ordered over allegations the executive committed financial fraud with the aim of skirting United States sanctions on sales to Iran, Chinese authorities seized the two Canadians this week for allegedly "endangering national security".

Conservative Leader Andrew Scheer said today the Liberal government needs to be more forceful with Beijing regarding the plight of the two Canadians detained in China, attacking what he calls the prime minister's "naive approach". She was arrested December 1 at the request of the United States, which wants her extradited to face bank fraud charges. The allegations have not been proven in court.

"This is a situation we are watching closely as the political environment is unpredictable and could have significant negative consequences", Cam Dahl, president of Cereals Canada, an industry group whose members include grain handlers Richardson International Ltd., Cargill Inc., and Glencore Plc's Viterra unit, said in an email.

The justice minister could deny the U.S. request if they deem "it has been made for an improper goal", said one official.

"The detention of two Canadian citizens is unacceptable, they ought to be returned", Pompeo said.

Foreign Affairs Minister Chrystia Freeland is calling the detainment of two Canadians in China "very concerning".

"I personally believe that if Canada extradites Meng to the US, China's revenge will be far worse than detaining a Canadian", Global Times editor-in-chief Hu Xijin said in a video posted to the pro-government Chinese daily's website on Wednesday.

It's asking the Chinese authorities for consulate access to him.

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Trudeau travelled to China previous year but returned home without a formal agreement between the two countries to begin formal free trade talk negotiations.

Freeland indicated Spavor notified Canadian officials he was "being asked questions by Chinese authorities" but said her department has "not been able to make contact since he raised those concerns".

China called the USA ambassador to make a formal protest over the issue. If convicted, she faces more than 30 years in prison. "And they took this decision without any political involvement or interference". The arrest of Meng is an unwelcome complication. Meng Wanzhou was arrested in Vancouver, Canada.

China is one of Canada's biggest buyers of agricultural products from oilseeds to softwood lumber and is a growing market for the nation's banks, insurers and luxury-good makers.

Sprint's parent, SoftBank Group Corp (9984.T), plans to replace 4G network equipment from Huawei with hardware from Nokia (NOKIA.HE) and Ericsson (ERICb.ST), Nikkei reported on Thursday, without citing sources.

She was released on bail of US$7.5 million by a court in Vancouver on Tuesday pending a USA extradition hearing.

The following morning, Ms Meng was spotted by AFP answering the front door of her Vancouver house to three visitors bringing flowers who arrived in a sedan with diplomatic plates.

The terms of her bail also require Meng to wear an electronic tracking device and be subject to 24-hour surveillance by a company that employs former police and military personnel to monitor people.

It might take some time for the case to get into court for that hearing.

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