A second Canadian has been arrested in China in a potential act of retribution, signalling a serious escalation of the diplomatic crisis between Washington, Beijing and Ottawa following the arrest of Chinese telecom giant Huawei's Chief Financial Officer (CFO) at the request of the US.
The Canadian Foreign Ministry identified the national as Michael Spavor, the founder of the Paektu Cultural Exchange, a Canadian owned-China based company that helps to facilitate trips to North Korea.
He is said to have deep ties with the Pyongyang government.
China's Foreign Ministry on Thursday confirmed that Spavor and Michael Kovrig, a former Canadian diplomat who currently works for the non-profit organization International Crisis Group as its northeast Asia senior adviser, were "being investigated" on suspicion of "activities that endangered China's national security", CNN reported.
The ministry had said on Wednesday that Kovrig's arrest involved a comparatively mild administrative matter involving the registration of a non-governmental organization.
Chinese ministry spokesman Lu Kang said authorities had taken "compulsory measures" on the two men on December 10 and that both cases remained under investigation and added that Canada had been notified of both arrests and that "the legitimate rights and interests of the two Canadians are safeguarded now".
The move by Beijing signalled a serious escalation of the diplomatic crisis that began when Canada detained Huawei's CFO Meng Wanzhou in Vancouver earlier this month at the request of American prosecutors on charges of bank fraud related to violating sanctions against trade with Iran.
Spavor, who has not been heard from for 24 hours, had contacted Canadian consular officials in Beijing after being questioned.
He is based in Dandong, near the Chinese border with North Korea and had previously assisted in helping former NBA player Dennis Rodman travel to Pyongyang to meet Kim Jong-un, the North Korean leader.
News of Spavor's disappearance came shortly after Canadian Foreign Minister Chrystia Freeland acknowledged that Chinese authorities had arrested former Canadian diplomat Kovrig. Beijing says Kovrig worked for an organization that had not been legally registered under a new law.
Freeland said earlier on Thursday that they were still trying to learn the fate of the two, suggesting neither had been visited by Canadian diplomats.
She also warned the administration of US President Trump not to further politicize what started as a legal matter involving accusations that Huawei had committed bank fraud.
"We have been unable to make contact (with Spavor) since he let us know he was being questioned by Chinese authorities," Canadian government department Global Affairs spokesman Guillaume Berube said.
"We are working very hard to ascertain his whereabouts and we continue to raise this with the Chinese government," he added.
The Americans are seeking the extradition of Meng, who is the daughter of the Huawei founder. She was released on Tuesday on bail while a Canadian court decides whether to extradite her to the US to face charges there.