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Germany ‘planning to exclude Huawei from new 5G network’ as US reportedly investigates theft claims

Tech fallout comes amid deepening diplomatic dispute

Harry Cockburn
Thursday 17 January 2019 15:04 GMT
Huawei faces exclusion from future mobile network upgrades
Huawei faces exclusion from future mobile network upgrades (AFP/Getty)

The German government is reportedly exploring whether it can exclude Chinese technology company Huawei from future mobile infrastructure, apparently due to concerns over security.

The move comes amid a deepening diplomatic row involving China, Canada and the US after Washington accused Huawei’s chief financial officer - the daughter of the company’s founder - of fraud, and new allegations of the theft of trade secrets have been reported.

German newspaper Handelsblatt, citing government sources, said Berlin was discussing setting security standards Huawei currently cannot achieve, effectively blocking its participation in the rollout of fifth-generation (5G) mobile networks.

Changes to the German telecommunications law were also under consideration as a last resort, the paper said.

The deliberations would mark a shift from the German government's position back in October 2018, when it told politicians it saw no legal basis to exclude any vendors from an upcoming 5G auction, despite warnings from Washington.

The government said in a more recent response the security of 5G networks was "extremely relevant", and would guide its upcoming decisions, Handelsblatt reported.

US officials have briefed allies that Huawei is ultimately at the beck and call of the Chinese state, and has warned the company’s network equipment could contain “back doors” leaving them vulnerable to cyber espionage.

Huawei said the security concerns are unfounded.

Handelsblatt quoted Huawei founder Ren Zhengfei as saying his company had never received a request from a government to transmit information in violation of any regulations.

“I love my country, I support the Communist Party, but I would never do anything that would harm another country in the world,” it quoted him as saying.

Huawei is at the centre of fraud and intellectual copyright theft investigations in America, and tensions have been inflamed since Canada arrested the company’s chief financial officer Meng Wanzhou at Vancouver airport on 1 December 2018 at the request of US authorities.

America wants Ms Meng, the daughter of Huawei’s founder, extradited to face fraud charges. She is accused of using a subsidiary company to circumvent sanctions against Iran.

China recently re-tried a Canadian drug smuggler who in November had been jailed for 15-years. At the retrial he was given the death sentence, with prosecutors saying the earlier sentence had been “too lenient”.

It has also detained two other Canadian nationals in the country “on suspicion of endangering state security”.

Beijing has expressed dismay at Ms Meng’s arrest and has warned Canada of “severe consequences” if she is not repatriated.

On Wednesday Washington stepped up the pressure on Huawei with the introduction of bills that would ban the sale of US chips or other components to Huawei, ZTE Corp or other Chinese telecommunications companies that violate US sanctions or export control laws.

The proposed law was introduced shortly before the Wall Street Journal published reports federal prosecutors were investigating allegations Huawei stole trade secrets from T-Mobile US Inc and other US businesses.

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Agencies contributed to this report

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