Sunday, December 16, 2018
Huawei phones Image copyright Reuters
Image caption Huawei is now the second biggest smartphone-maker after Samsung

Chinese telecoms giant Huawei has been the focus of international scrutiny, with several countries raising security concerns about its products.

Then on 1 December, the company’s chief financial officer, Meng Wanzhou, was arrested in Canada. At a court hearing in Vancouver on 7 December it was revealed that she was wanted in the US on fraud charges relating to the alleged breaking of US sanctions on Iran.

It has also been reported that Japan’s government will stop buying equipment from Huawei, and rival Chinese manufacturer ZTE.

What are countries worried about?

There are fears that China is using Huawei as a proxy so it can spy on rival nations and scoop up useful information. Huawei has said it is independent and gives nothing to the country’s government, apart from relevant taxes.

Critics question how free any major Chinese business can be from Beijing’s influence. They point out that its media-shy founder, Ren Zhengfei, was a former engineer in the country’s army and joined the Communist Party in 1978.

Huawei is keen to portray itself as a private company owned by its employees with no ties to the Chinese government beyond those of a law-abiding taxpayer.

It can also lay claim to being one of the biggest spenders on research and development. It invested more than $13.2bn (£10.3bn) in 2017 and has said the figure will be even higher for 2018.

But critics fear that the Chinese government could order the firm to modify its devices to help hack attacks, eavesdrop on conversations or gain high-level access to sensitive networks.

There are questions about whether China would allow a technology firm that has been deeply embedded in rival nations’ infrastructure to remain independent. Huawei is now the second biggest smartphone-maker in the world.

Image copyright Reuters

Image caption Huawei equipment is being used in fast 5G mobile networks around the world

Which countries have taken action?

  • In November, New Zealand barred Huawei from supplying a local mobile network with 5G equipment
  • The US and Australia had already closed the door on Huawei’s involvement in their next-generation mobile networks
  • Canada is carrying out a security review of Huawei’s products
  • UK service provider BT is removing Huawei kit from the core of its 5G network
  • On 7 December, the EU‘s technology commissioner Andrus Ansip said countries “have to be worried” about Chinese manufacturers
  • But the interior ministry of Germany says it opposes banning any suppliers from its 5G networks

The UK has not enacted a ban on the use of Huawei equipment. However, the firm’s products are regularly subjected to security testing by the UK’s GCHQ intelligence agency.

The co-operative agreement between the UK and Huawei includes a facility nicknamed the Cell in Banbury, Oxfordshire. There, staff employed by Huawei but answering to GCHQ look for security flaws in the company’s products.

The last report GCHQ produced said it found “shortcomings” in products that meant it could only give “limited assurance” that the firm posed no threat.

This week, the Financial Times reported that Huawei had agreed to a series of technical demands by GCHQ that would harden its products against attackers.

Huawei said the changes came from its co-operation with the UK and did not signal that it had “caved in” to UK demands, as the Financial Times had said.

Why was a Huawei executive arrested?

Image copyright Reuters

Image caption Ms Meng faces extradition to the US on fraud charges

Ms Wanzhou was arrested while transferring between flights in Vancouver although her detention was not revealed by Canadian authorities until four days later, the day of her first court appearance.

Details of the charges were also not revealed at the time after she was granted a publication ban by a Canadian judge.

But at a bail hearing at the Supreme Court of British Columbia, a Canadian government lawyer said Ms Meng had used a Huawei subsidiary called Skycom to evade sanctions on Iran between 2009 and 2014.

The court was told she had publicly misrepresented Skycom as being a separate company.

China has demanded Ms Meng’s release, insisting she has not violated any laws.

In a statement, Huawei said it was not aware of any wrongdoing by Ms Meng, adding: “The company believes the Canadian and US legal systems will ultimately reach a just conclusion. Huawei complies with all applicable laws and regulations where it operates, including applicable export control and sanction laws and regulations of the UN, US and EU.”

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