The curious case of China Mobile: How a Chinese state-owned company that is sanctioned in the United States for military collaboration came to receive Canadian taxpayer-funded pandemic wage supports and is now taking the federal Government of Canada to court. Thread. 1/
The Canadian Emergency Wage Subsidy (CEWS) program is a pandemic wage support for Canadian businesses. To date, the program has processed $96.42 billion in claims. Corporate recipients of CEWS are disclosed in name, but the amount received from the program is not disclosed. 2/
The Government of Canada previously had a browsable recipient list which was removed from its website. The Globe and Mail reported Canada Revenue Agency officials had said demand for the full list was higher than expected, leading to technical issues. 3/
theglobeandmail.com/business/artic…
You now need to do a keyword search to find which companies accessed CEWS because the list was never restored, which is more difficult because corporate names are not always the same as “Doing Business As” names. You can’t just scroll and see if something catches your eye. 4/
This alteration makes tracking down recipients much harder. Incidentally, the changes made by the government due to "technical issues" were made to the website days after it was reported that various Chinese state-owned companies had accessed the CEWS program. Interesting. 5/
Some of the big CEWS recipient names included Chinese state-owned and operated corporate giants such as Sinopec, CNOOC, PetroChina, the Bank of China, Beijing Capital, Hainan, Air China, and China Southern Airlines. 6/
What was not as widely reported is that China Mobile, a major telecom firm in China, also received the wage subsidy. It's the world's largest mobile network operator by total number of subscribers, controlling a 70% share of its domestic market, earning $152.5 billion in 2020. 7/
The US Department of Defence shared a list in mid-2020 of Chinese state-owned entities to be sanctioned for collaboration with the People’s Liberation Army. China Mobile is on it. This is the big story here, because they are sanctioned for collaborating with Chinese military. 8/
How much exactly did US-sanctioned China Mobile, the largest telecom provider in the world, get from Canadian taxpayers via CEWS? We don’t know. The Government of Canada won’t disclose that amount. We do know a few things though. They did quite well during the pandemic. 9/
China Mobile posted a 3% increase in operating revenue after accessing Canadian wage supports. We know that its revenue increased by almost $4 billion from 2019. Not too shabby for a company hit so hard by the pandemic that it needed Canadian corporate welfare. 10/
Here’s the other thing: China Mobile doesn’t even own or operate any telecom network facilities in Canada. Instead, it piggybacked onto Telus to provide wireless services through Telus' network. China Mobile partnered with Telus to provide SIM cards, under the brand CTExcel. 11/
The best part of all this is that China Mobile is also partnered with Huawei. They even released a paper about their joint 5G adventures. ‘Huawei, China Mobile, & Industry Partners Release 5G-Advanced Technology Evolution from a Network Perspective.’ https://t.co/jGBmWAw6Tr 12/
huawei.com/en/news/2021/7…
After China Mobile was sanctioned by the US, it was delisted from the New York Stock Exchange. It had a stock sell-off to raise money after taking a large financial hit. Huawei naturally stepped in to help its partner, snapping up 220 million shares. 13/
Telus had originally partnered with Huawei to provide its 5G services. While the company officially back-pedalled and ultimately went with Ericsson and Nokia instead, there is already existing Huawei gear throughout Telus’ radio access network on cell towers across Canada. 14/
There already are Huawei 5G towers in Canadian cities, constructed before Telus switched, and China Mobile SIM cards pinging them. We don’t know much about that, because Innovation, Science and Economic Development Canada made Telus sign a NDA on its relationship with Huawei. 15/
The paper I posted that was jointly written by China Mobile and Huawei was published on August 5th. August 9th, the federal government ordered China Mobile to divest from Telus and close its Canadian business, due to findings discovered after a security review was conducted. 16/
What were the findings? That China Mobile's presence could result in Canadian businesses being leveraged “for non-commercial purposes, such as the compromise of critical infrastructure and foreign interference, to the detriment of Canada’s national security.” Very serious. 17/
Why was the review executed? China Mobile conveniently “forgot” to notify the government it had established a business in Canada until 2021. All foreign entities need to do this under the Investment Canada Act, and be subjected to preliminary, or if needed, in-depth reviews. 18/
Hold on though. China Mobile established its Canadian company in 2015. That means we allowed a Chinese state-owned telecom provider to operate in Canada without a security review being conducted as required by the Investment Canada Act for SIX whole years? This wasn't caught? 19/
This is an egregious national defence oversight by the Government of Canada. Nobody even noticed this company, collaborating with Huawei and delivering services through Telus, until it filed its papers six years after it started operating in the country. Unbelievable. 20/
Now for the second blow to taxpayers: China Mobile is upset it has to give up its business because it lied to the government. It says the security review is “tantamount to speculation about what it may do,” such as using its access for “military applications or espionage.” 21/
So what is China Mobile doing about it? Taking the federal Government of Canada to court, of course. It wants the courts to overturn the divestment decision. Naturally, taxpayers will be funding the defence of this ousting, because we fund everything in this country. 22/
Recap: We gave a sanctioned Chinese state-owned company wage supports and they profited, but collaborated with Huawei and lied to the government so they are being ousted from Canada. In retaliation, they are taking the government to court, and taxpayers will cover the cost. 23/
Isn't it just wonderful how that all panned out? And why is no one asking how come a review wasn't done under the Investment Canada Act and the National Security Review of Investments six years ago when the company opened? We could have saved quite a bit of money, it seems. 24/
Every single Canadian should read this thread to understand that the mismanagement of this country is so inexcusable and so vast that it is literally threatening our national security at this point from multiple angles. Fin. Thank you for reading. 25/
@Hannah_Bananaz Kind of strange that this company came to Canada AFTER the Liberals got elected, in 2015….
