Sep 11, 2021

By Jeremy Logan

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The Liberal government has directed a state-owned Chinese telecommunications firm to divest its stake in a Canadian subsidiary over national security concerns, prompting a court challenge of the order.

China Mobile International Canada is asking the Federal Court to set aside the recent decision, saying the government has no grounds to believe the company would compromise security or engage in espionage on behalf of Beijing.

CMI Canada says the Trudeau government was motivated, at least in part, by “the current political socioeconomic climate and the general biases against Chinese state-owned companies.”

The case unfolds amid high tensions between Ottawa and Beijing over China’s prolonged detention of Canadian citizens Michael Kovrig and Michael Spavor for alleged spying.

China’s actions against Spavor and Kovrig are widely seen in the West as retaliation for the late 2018 arrest by Canadian authorities of Meng Wanzhou, an executive with Chinese firm Huawei Technologies, so she can be extradited to the U.S. to face fraud charges.

CMI Canada’s application filed this week in Federal Court reveals details of an investment screening case that has quietly unfolded outside the public eye over the last year.

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