Two B.C. companies ordered to shut down on national security grounds

https://vancouversun.com/news/local-news/two-b-c-companies-ordered-to-cease-all-operations-over-national-security-concerns

by JumpCrisscross • 2 years ago

101 75 2 years ago

vancouversun.com

walterbell• 2 years ago

Local details in this article: https://vancouversun.com/news/local-news/two-b-c-companies-o...

perihelions2• 2 years ago

This article is much more informative than the current OP (Reuters); one vote for me that mods put up this one instead.

dang• 2 years ago

Changed to that from https://www.reuters.com/business/canada-orders-dissolution-t.... Thanks!

mc323• 2 years ago

I hope there’s more meat to the reason than a nebulous and unfalsifiable "rigorous scrutiny by Canada's national security and intelligence community".

A country can set whatever rules of engagement they want, but they ought to be transparent.

jncfhnb2• 2 years ago

Beijing should not be involved in security tech. Seems sufficient to me

mc323• 2 years ago

They should spell out what they did or do.

JumpCrisscross12• 2 years ago

hope there’s more meat to the reason than a nebulous and unfalsifiable

"...ministry spokeswoman said it cannot provide more details citing confidentiality provisions in the Investment Canada Act, the legislation that allows for a national security review of any foreign investment into the Canada, regardless of its value" [1].

Presumably the companies can disclose. But "Bluevec has not yet responded to a request for comment about the federal order of dissolution."

[1] https://vancouversun.com/news/local-news/two-b-c-companies-o...

alistairSH• 2 years ago

30 seconds of digging indicates the drone company sold anti-drone tech to China. Seems like an obvious no-no for a Canadian company, no?

jszymborski5• 2 years ago

This gives a good clue as to what was going on:

Last year, B.C. Supreme Court Justice Nitya Iyer ordered Jia, Bluevec and another Bluevec employee to pay $800,000 to SkyCope for misusing its confidential information and selling a direction-finding code to Chinese anti-drone company Beijing Lizheng Technology.

Sounds like Bluevec was taking direct investment from China, and relaying trade secrets of a Canadian company working in the defence industry to a foreign adversary.

aragonite3• 2 years ago

... relaying trade secrets of a Canadian company working in the defence industry to a foreign adversary ...

SkyCope itself is owned by a Chinese company, Shenzhen Shengkong. Bluevec is, if anything, the more "Canadian" of the two companies.

[188] Skycope submits that it and its parent companies have suffered detriment by being forced into extensive litigation in China and that Bluvec and Lizheng’s entry into the market has harmed Skycope and Shengkong’s market position in China. ...
[222] ... Similarly, there is no evidence that Skycope (including its parent, Shengkong) operates outside of Canada and China.

https://www.canlii.org/en/bc/bcsc/doc/2023/2023bcsc1288/2023...

JumpCrisscross12• 2 years ago

"Bluevec was the subject of a civil suit by competitor Vancouver-based SkyCope Technologies, which alleged Bluevec stole trade secrets through former SkyCope employees and gained a competitive advantage.

Last year, B.C. Supreme Court Justice Nitya Iyer ordered Jia, Bluevec and another Bluevec employee to pay $800,000 to SkyCope for misusing its confidential information and selling a direction-finding code to Chinese anti-drone company Beijing Lizheng Technology.

In court, Jia testified Lizheng was Bluevec’s biggest customer, but SkyCope alleged Jia was the owner of the Beijing company. Court records cited a decision on a separate case by a Beijing arbitration commission that found Jia was a shareholder in Lizheng and held shares in the company held in trust by other individuals."

TL; DR Founder appears to be a serial liar per court decisions in China and Canada. He stole anti-drone technology from a Canadian company (EDIT: stole Canadian technology from a Chinese-owned company operating in Canada) and gave it to China.

mc323• 2 years ago

This much better and spells out clear reasons. Looks like industrial espionage. Done I don’t know the structure of the company can’t tell if it’s reasonable or not to shut down the whole company. Of course it could be, if they were set up intentionally to do just that with some stooges along the way.

jszymborski5• 2 years ago

While the administrative action is opaque, the B.C. Supreme Court isn't, and they found Bluevec guilty of "misusing its confidential information and selling a direction-finding code to Chinese anti-drone company".

That, to me, doesn't "look like industrial espionage", but rather is pretty clear cut.

linearrust3• 2 years ago

TL; DR Founder appears to be a serial liar per court decisions in China and Canada. He stole anti-drone technology from a Canadian company and gave it to China.

You never stop with the anti-china propaganda.

'The two met when working in the Beijing office of Fortinet, a cybersecurity firm. Both transferred to Fortinet’s Vancouver office and became good friends. After Liu left the company in 2016 to form SkyCope and work on developing anti-drone technology, Jia joined him months later as SkyCope’s chief technology officer.'

It is one chinese guy stealing from another chinese guy.

JumpCrisscross12• 2 years ago

the anti-china propaganda

I am a China hawk. But nothing here implicates the CCP.

It is one chinese guy stealing from another chinese guy

One, their ethnicity and even nationality are irrelevant.

Two, that was already adjudicated. This action is about one person--with adverse court records in two countries--stealing defence technology and "selling" it to a company he controls in China. The stealing was a civil matter. The exfiltration is a national-security one.

aragonite3• 2 years ago

He stole anti-drone technology from a Canadian company and gave it to China.

No. SkyCope itself is owned by a Chinese company, Shenzhen Shengkong. Also, Bluevec did not "give" the anti-drone tech to "China". It sold it to a (different) Chinese company for $800,000.

[182] The defendants’ submissions characterize the Bluvec Code as “rudimentary” and say it did not use anything other than technology that was commonly known in the industry. However, Dr. Pan admitted that, while he was still working at Skycope, he wrote direction-finding code for Mr. Jia that later became part of the Bluvec Code. Bluvec subsequently sold that direction-finding technology to Lizheng for $800,000.
[188] Skycope submits that it and its parent companies have suffered detriment by being forced into extensive litigation in China and that Bluvec and Lizheng’s entry into the market has harmed Skycope and Shengkong’s market position in China. ...
[222] ... Similarly, there is no evidence that Skycope (including its parent, Shengkong) operates outside of Canada and China.

https://www.canlii.org/en/bc/bcsc/doc/2023/2023bcsc1288/2023...

JumpCrisscross12• 2 years ago

SkyCope itself is owned by a Chinese company

Thanks. Edited.

Given Ottawa is using a national security law, it would appear there would be ring-fencing around SkyCope that these companies didn’t have. Curious if SkyCope has military customers in China like at least one of these companies allegedly did [1].

Bluevec did not "give" the anti-drone tech to "China". It sold it to a (different) Chinese copmany

Don’t court records in China show the company he “sold” it to is controlled by him?

[1] https://web.archive.org/web/20240105144551/https://pegauni.c...

Animats• 2 years ago

Here's more useful background. Back in 2018, SkyCope, which makes drone detection and jamming devices, won an injunction against one of their founders who split off to found a competing company.[1] Later, two competing companies. He also founded Pegauni.[2] This seems to be a follow-on of that dispute.

Back in 2018, small drones were not much of a national security issue. Now, they are.

[1] https://vancouversun.com/news/local-news/vancouver-anti-dron...

[2] https://web.archive.org/web/20240202225640/https://pegauni.c...

perihelions2• 2 years ago

They're not very subtle about what they are doing,

https://web.archive.org/web/20240105144551/https://pegauni.c... ("Customers")

- "Military/National Security Projects"

- "Macau Battleship"

- "Chinese National Parade"

- "Chinese Air Craft Carrier (No Pictures due to security reasons)"

- "National Security Beijing"

- "Military Base Security"

aragonite3• 2 years ago

That background leaves out the fact that Skycope itself is literally owned by a (different) Chinese company, so I doubt this is a follow-on of that in any straightforward sense.

[188] Skycope submits that it and its parent companies have suffered detriment by being forced into extensive litigation in China and that Bluvec and Lizheng’s entry into the market has harmed Skycope and Shengkong’s market position in China. ...
[222] ... Similarly, there is no evidence that Skycope (including its parent, Shengkong) operates outside of Canada and China.

https://www.canlii.org/en/bc/bcsc/doc/2023/2023bcsc1288/2023...

nickpeterson• 2 years ago

It’s a shame a two companies that have been in business for over 2000 years were brought down by a court order

wizzwizz4• 2 years ago

There aren't actually any companies that old. The closest (according to Wikipedia) is 金剛組 (Kongō Gumi), which was family-owned for over 1420 years, until its purchase by a conglomerate in 2006.

omneity• 2 years ago

I read it as a double entendre joke about B.C.

Whether it's appropriate on HN is another matter.

josh2600• 2 years ago

Just make all security tech open source, then there’s no issues!

I jest! (But kinda not?!)

RecycledEle• 2 years ago

One could ask: Why is the US not a decade ahead of the rest if the world in weaponizing small drones and deploying countermeasures to them?

The answer is a few letter: ATF & FAA.

If the original intent and clear meaning of the 2nd Amendment to the United States Constitution had been honored, armed drones and countermeasures to them would be common in the USA.

If the US looses a war in the next 20 years, it will be the fault of the ATF & FAA.

hatenberg• 2 years ago

Yes, let's add citizens terrorizing each other with drones to the list of problems we have.

crummy• 2 years ago

That's the price of the second amendment!

marnett• 2 years ago

My understanding of military tech is that it is fairly hard to determine where the current state of the art is due to just how classified it all is.

How can you claim this with confidence?

gumby4• 2 years ago

There are reports from Ukraine that US supplied drones (both civilian and military) have not been effective — and this from a country that has been able to put drones made of cardboard to good use!

mikewarot2• 2 years ago

They make drones by the millions, it doesn't matter how many $200,000 gold plated hangar babies we have, they'll be swamped by the end of the first month, and we won't be able to replace them.

loceng• 2 years ago

Which shouldn't necessarily instil confidence, as that technology isn't distributed and if a government was to become corrupted/captured and tyrannical, then the government would exclusively have access to that latest tech.

TylerE• 2 years ago

It is foolish to assume they aren’t. They’ve been flying the things since the 80s

benblu• 2 years ago

This thread is a weird place for you to soapbox. This is about two companies in Canada. Not only that, but it's about intelligence / security concerns, not airspace regulations.

Jerrrrry3• 2 years ago

  >Why is the US not a decade ahead

your implication runs foul there.

carry a big stick, but never pull it all out. just enough to win the stick-measuring contest.

The pitcher doesn't throw past 50% in warm-ups for a reason.

You know who benefits from the "idea" of an "incompetent" U.S military?

Us. Our intentional false projection of insecurity is just another layer of obfuscation.

A swarm of drones in any city could be neutralized within seconds if warranted.

You severely underestimate the power of the most powerful nation of the planet.

fragmede3• 2 years ago

Hopefully. But where military tech trickles down to consumers, and consumers can't have any fun with drone thanks to the FAA, we don't have the drone ecosystem that it would take to win that contest. The US military draws from the US, so it can't go to the civilians and ask for drone operators and mechanics and engineers if there's not a vibrant drone ecosystem. How many high schoolers in the US are playing with drones to become future drone company owners? Manufacturing them, designing new ones, fixing existing ones. I want to believe but the FAA rules are just so stifling that it's just not there.

narrator• 2 years ago

The Houthis have shown that with the proliferation of advanced cheap drones we're starting to enter a period like the 18th century where random rebels can compete militarily with nation states. The ATF and FAA don't know how to handle that. Meanwhile, U.S adversaries are taking advantage of that paralysis.

snakeyjake• 2 years ago

You may not work for the military-industrial complex, but I do.

The US is over a decade ahead in deploying countermeasures to small drones. Systems like T-HEL were deployed over two years ago to an unspecified combat zone for field tests. There is a multi-layered approach to countermeasures including detection, jamming, and kinetic and energy attacks.

The US doesn't really have a program to weaponize small drones because it does not need one. You do not need a DJI phantom with a VOG-17 grenade on it being piloted by a soldier within artillery range of the enemy when you have operators at Creech and Holloman shooting hellfires at targets halfway around the globe.

Where jamming systems like Russia's Breakwater has been seen, repeatedly, on drone footage being observed and attacked by small drones, US systems like MFEW-AL are so effective that they are almost impossible to test in the US due to the coordination needed to ensure that cellphone coverage for the entirety of Kern County, CA or Clark County, NV isn't annihilated by its output.

Detection is also where coming capabilities will eclipse the rest of the world. DARPA has several programs to develop and commercialize detection techniques that are very impressive including Moving Target Recognition and Target Recognition and Adaption in Contested Environments, where multi-spectrum systems orbiting overhead will automatically detect, recognize, categorize, and alert persons and other systems in the area of a flying drone (or moving tank or truck) from 60,000 feet (or from SPAAAACE, in the future).

The vision is that automated surveillance hits get pushed out to systems on the ground, jammers activate, kill systems switch to "auto", and ELINT systems hunt for the transmitter so that target tasking can happen and a hellfire or artillery round deployed.

It's going to take time to design, build, test, and deploy those systems but they're coming and for all practical purposes nobody else (excluding Israel) has even started.

It's very exciting.

chx2• 2 years ago

I would like to know what gives the federal government power to do this -- and whether a court of law got involved.

When Stephen Harper tried to revoke citizenship without judicial oversight we have sacked him. I am not quite sure how I feel about this if a court was not involved but I can't find the source. I at least would feel rather uneasy if the gov could just say "this company shouldn't exist".

Edit: ah. Found it. https://www.canada.ca/en/innovation-science-economic-develop...

In accordance with the Investment Canada Act, foreign investments are subject to review for national security concerns.

I guess that's ... okay. I would still have much more liked a court in the middle but I guess since this is specifically a foreign investment this is ok. The very act https://laws-lois.justice.gc.ca/eng/acts/i-21.8/FullText.htm... begins with:

Recognizing that increased capital and technology benefits Canada, and recognizing the importance of protecting national security, the purposes of this Act are to provide for the review of significant investments in Canada by non-Canadians in a manner that encourages investment, economic growth and employment opportunities in Canada and to provide for the review of investments in Canada by non-Canadians that could be injurious to national security.

JumpCrisscross12• 2 years ago

would still have much more liked a court in the middle

It’s an order to dissolve, not a dissolution per se. The accused can take it to court if they disagree.

chx2• 2 years ago

Decisions and orders of the Governor in Council, and decisions of the Minister, under this Part are final and binding and, except for judicial review under the Federal Courts Act, are not subject to appeal or to review by any court.

kylehotchkiss• 2 years ago

Maybe USA prodded them.

Canada doesn’t seem to be getting the increasing hostility towards the west as quickly as their big brother to the south and that’s a bit of a security hole I’m sure the USA is keen to address.

hsyehbeidhh• 2 years ago

Before I read the article I knew Chinese people were involved. It’s always the same story. Cultures. Oh dear.

Two B.C. companies ordered to shut down on national security grounds

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