VANCOUVER • A top executive of Chinese telecoms giant Huawei Technologies was granted bail by a Canadian court on Tuesday, 10 days after her arrest in Vancouver at the request of US authorities sparked a diplomatic dispute.

Ms Meng Wanzhou, Huawei's chief financial officer and the daughter of its founder, faces US accusations that she misled multinational banks about Iran-linked transactions, putting the banks at risk of violating US sanctions.

In a court hearing in Vancouver, British Columbia, Justice William Ehrcke granted C$10 million (S$10.3 million) bail to Ms Meng, who has been jailed since her arrest on Dec 1. The courtroom erupted in applause when the decision was announced. Ms Meng cried and hugged her lawyers.

Among the conditions for her bail, the 46-year-old executive must wear an ankle monitor and stay at home from 11pm to 6am. Five friends pledged equity in their homes and other money as a guarantee that she will not flee.

If a Canadian judge rules that the case against Ms Meng is strong enough, Canada's Justice Minister must next decide whether to extradite her to the US. If so, she would face US charges of conspiracy to defraud multiple financial institutions, with a maximum sentence of 30 years for each charge.

The arrest of Ms Meng has put a further dampener on China's relations with the US and Canada at a time when tensions are already high over a trade war and US accusations of Chinese spying.

US President Donald Trump told Reuters on Tuesday that he would intervene in the US Justice Department's case against Ms Meng if it would serve national security interests or help close a trade deal with China.

Speaking in Beijing, Chinese Foreign Ministry spokesman Lu Kang said Ms Meng's arrest "was a mistake from the start".

"We have already made clear our position to the United States and Canada, who should immediately correct their mistake and release Meng Wanzhou," he told a daily news briefing.

"Any person, especially if it is a leader of the United States, or a high-level figure, who is willing to make positive efforts to push this situation towards the correct direction, then that, of course, deserves to be well received," Mr Lu added.

China had threatened severe consequences unless Canada released Ms Meng immediately, and analysts have said retaliation from Beijing over the arrest was likely.

Ms Meng, who was arrested as she was changing planes in Vancouver, has said she is innocent and will contest the allegations in the US if she is extradited.

Tuesday was the third day of bail hearings. Ms Meng's defence had argued that she was not a flight risk, citing her longstanding ties to Canada, properties she owns in Vancouver and fears for her health while incarcerated.

Her family assured the court she would remain in Vancouver at one of her family houses in an affluent neighbourhood. Her husband said he plans to bring the couple's daughter to Vancouver to attend school.

"I am satisfied that on the particular facts of this case... the risk of her non-attendance in court can be reduced to an acceptable level by imposing bail conditions," said the judge, adding that he was also persuaded by the fact that Ms Meng was a well-educated businesswoman with no criminal record.

Ms Meng was ordered to reappear in court on Feb 6 to make plans for further appearances.

Huawei, which makes smartphones and network equipment, said it looked forward to a "timely resolution" of the case. "We have every confidence that the Canadian and US legal systems will reach a just conclusion," it said, adding that it complies with all laws and regulations where it operates.

REUTERS