She now faces possible extradition to the U.S. This time around, however, the issue is not a potential national security risk, but rather accusations that CFO Wanzhou Meng violated U.S. sanctions regarding Iran.
Sources told Reuters in April that USA authorities have been investigating Huawei, the world's largest telecoms equipment maker, since at least 2016 for allegedly shipping us -origin products to Iran and other countries in violation of USA export and sanctions laws.
The arrest comes at a delicate time in US-China relations.
Eric Harwit, an Asian studies professor at the University of Hawaii at Manoa who has written extensively on Chinese telecoms, said the arrest was not just about sanctions violations but the bigger picture of the USA worrying about Chinese hi-tech firms becoming rivals to American companies in the future.
Huawei issued a statement saying Meng was changing flights in Canada when she was detained "on behalf of the United States of America" to face "unspecified charges" in NY.
Meng is a prominent member of Chinese society as deputy chairwoman of the Huawei board and the daughter of company founder Ren Zhengfei.
Canada on Saturday arrested Meng Wanzhou, Huawei's global chief financial officer, in Vancouver, where she is facing extradition to the USA on suspicion she violated US sanctions against Iran, the Globe and Mail newspaper reported on Wednesday. Huawei is by far China's most global technology company, with operations spanning Africa, Europe and Asia.
Huawei has said Ms. Meng was arrested at the request of the US, which is seeking her extradition. Later, the foreign ministry said it was still waiting for details on why she was arrested, and said trade talks should continue.
Huawei, in that statement, also said the company complies with all applicable US and Canadian laws.
Huawei has said it complies with all applicable export control and sanctions laws and US and other regulations. The Globe and Mail newspaper cited law enforcement sources as saying she is suspected of trying to evade US curbs on trade with Iran.
Earlier this year, the U.S. imposed a seven-year ban on the sale of crucial usa components to Chinese smartphone maker ZTE after finding it had failed to take action against staff who were responsible for violating trade sanctions against Iran and North Korea.
Over the years, she has been director of the worldwide accounting department, chief financial officer of Huawei Hong Kong and president of the accounting management department at the company. Chinese technology has been a particular bugbear for the US president, who has justified imposing tariffs on Chinese imports with allegations of intellectual property theft by Chinese companies.
A user of China's Twitter-like Weibo platform said Chinese should boycott products made by USA tech giant Apple Inc and instead buy Huawei products to show support for one of China's national champions.
"The Chinese side firmly opposes and strongly protests over such kind of actions which seriously harmed the human rights of the victim", the diplomatic mission said in a statement.
United States lawmakers have repeatedly accused the company of being a threat to USA national security, arguing that its technology could be used for spying by the Chinese government.
Meng's arrest also threatened to inflame disagreements over Iran and Trump's decision to break with other governments and re-impose sanctions over the country's nuclear development.
Lenovo has also come under attack in the United States for allegedly selling compromised computers that expose users to spying. "We think this will force China to take a more aggressive and confrontational approach with the United States".
In a response, ZTE denied the charges while Huawei insisted it "posed no greater cybersecurity risk than any ICT [Information and Communications Technology] vendor".