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US panel to probe new complaints against Huawei, ZTE

Dunya News

An official said the panel has been receiving calls reporting suspicious behavior of the firms.

A US congressional report that urged American companies to stop doing business with Chinese telecom equipment makers Huawei and ZTE has triggered a fresh wave of complaints against the firms, opening a second phase to the panels investigation.A staff member of the House of Representatives Intelligence Committee said the panel has been receiving dozens and dozens of calls from current and former employees and customers reporting supposedly suspicious equipment behavior, chiefly involving Huawei.I dont think the companies should expect our attention to stop, the staff member told Reuters, adding that the panel would follow up on new leads. The staffer was not authorized to speak publicly on the matter.In a report issued on Monday after an 11-month investigation, the House committee warned U.S. industry that Beijing could use equipment made by the two companies to spy on certain communications and threaten vital systems through computerized links. It urged network providers to seek other vendors.The report also advised the Committee on Foreign Investments in the United States (CFIUS), an inter-agency government panel that vets foreign deals for security concerns, to block any future business tie-ups involving Huawei or ZTE and U.S. companies.Huawei, the worlds second-largest maker of routers and other telecom gear, and ZTE, the fifth-largest, both rejected the allegations. Chinas Commerce Ministry said the U.S. committee had made groundless accusations against China.Adding to Huaweis problems, Canada indicated on Tuesday that it would exclude Huawei from firms allowed to build a secure Canadian government communications network, citing possible security risks.In March, Australia barred Huawei from seeking contracts for the countrys National Broadband Network due to cyber security concerns. By contrast, the European Commission has delayed a trade case against the two Chinese telecom equipment makers, easing tensions between the European Union and its second-biggest trading partner.Huawei is employee owned, has operations in more than 150 countries, with more than two-third of its annual revenue of $32.4 billion earned outside of China.In early trade on Wednesday, ZTEs Hong Kong-listed shares were up as much as 4 percent after having fallen 11 percent during the previous two days. Several brokerages said the investigations were likely to have minimum impact on ZTEs bottom line, with investors switching their focus to 4G spending, which is expected to benefit the company.The U.S. panels 52-page report did not present concrete evidence that the companies equipment had been used for espionage, but a classified annex provides significantly more information adding to the committees concerns, it said.