Huawei: Ministers signal switch in policy over 5G policy
The government has indicated that it is slated to take a tougher line against the Chinese telecommunications equipment maker Huawei.
A review is underway of how future U.S. sanctions would affect the continued use of its products by the UK.
“As these penalties … are extensive, they are likely to have an impact on Huawei’s feasibility as a 5G network provider,” said digital secretary Oliver Dowden.
He added that he wanted Samsung and NEC to become 5G network kit suppliers.
They would help make UK mobile networks less dependent on the other two providers: Ericsson and Nokia. Dowden says the current situation represented a “market failure”.
Defense Secretary Ben Wallace added that the sanctions – which will enter into force in September – have been specifically designed to force the UK to rethink.
“It’s a better set of penalties than the previous one, and it’s specifically clearly designed smarter to put more pressure on countries that have high-risk sellers, especially Huawei.”
The penalties prohibit Huawei and third parties who manufacture their chips from using “US technology and software to design and manufacture” their products.
One consequence of this is that the company may lose access to the software it relies on to design and test its processors, as well as being able to put some of its more advanced chips into production.
The United States cites national security concerns as the cause of its intervention. American politicians have suggested that Beijing could use Huawei to spy on or even sabotage communications.
And this Tuesday, the Federal Communications Commission also designated Huawei as a national security risk, preventing local telecommunications companies from drawing on the agency’s funds to purchase the Chinese company’s equipment.
Huawei denies claims that it would help the Chinese government compromise its customers or otherwise deliberately harm them.
“We are investing billions to turn the Prime Minister’s vision of a” connected Kingdom “into a reality so that British families and businesses have access to fast and reliable mobile and broadband networks wherever they live,” said Victor Zhang, chief of the UK after the hearing.
“We have been in the UK for 20 years and remain focused on working with our customers and the government.”
The two cabinet ministers were testifying to the House of Commons defense subcommittee.
Dowden noted that the government’s ambition to remove Huawei from the British network is already “in time”.
However, according to the plans announced in January, the current plans are limited to excluding the company from the most sensitive parts of the network – the so-called core – and limiting Huawei’s market share of the base stations and other equipment “at the limit” to 35 % by 2023.
Dowden said it could change now.
“We will not hesitate to make decisions that will impose additional costs on mobile network operators, the main consideration is national security,” he said.
But he added that he was “a little cautious” in providing further details as the “final decisions were not made” and “any change in policy would be extremely market sensitive”.
The Department of Digital, Culture, Media and Sports is still investigating what impact Huawei or other new restrictions could completely rule out.
DCMS also asked GCHQ’s National Cyber Security Center to advise it on the security implications of U.S. sanctions.
NCSC previously raised concerns about “poor quality” of Huawei’s hardware and the potential for vulnerability it creates. But he currently manages the risk by carrying out checks on the products.
One concern is that if Huawei were forced to start relying on components from other suppliers, NCSC would no longer believe that the associated risks are manageable.
NCSC chief Ciaran Martin told MPs that “most of the analysis” had been done, but that further discussions were needed with the DCMS before a recommendation could be made to the prime minister.
Committee Member of Labor MP Kevan Jones raised concerns that the government was “bullied into doing what the Americans want.”
But Wallace replied: “Americans can do whatever they want with their IP [intellectual property]… it’s not an attack for us, it’s just a fact that if Huawei doesn’t work anymore because it can’t use a certain type of chip or something … we should get something else. “
Conservative MP Mark Francois also noted that the government faces a rebellion against the telecoms infrastructure law if it does not commit to ban.
“The bill is already dead as a dodo unless it effectively excludes Huawei,” said the deputy.
“Wouldn’t you save everyone a lot of time if I came to the House tomorrow and raised your hand?”
Dowden replied that he was “aware” of the threat of rebellion, but added: “You just have to wait and see” on what the government decision would be.
Ministers clarified that the ambition is not to have “high risk sellers” like Huawei on the UK’s 5G network.
But the crucial question is whether we are going to see a firm commitment to achieve this “ambition” and within a certain period of time.
The review of the impact of U.S. sanctions appears likely to lead the UK in that direction.
Although there may be technical reasons for the move, it would also prove politically convenient between the continued pressure from Washington and backbench conservatives, as well as the deterioration of relations with China.
But it remains to be seen exactly how far and quickly the government will move.