Huawei probe underlines U.S. fears of China's strategic threat


Bipartisan-backed legislation was introduced shortly before a newspaper report emerged revealing federal prosecutors are investigating Huawei for allegedly stealing trade secrets from USA businesses and could soon issue an indictment.

Huawei said in a statement the company and T-Mobile settled their disputes in 2017 following a US jury verdict that found "neither damage, unjust enrichment nor willful and malicious conduct by Huawei in T-Mobile's trade secret claim".

The investigation is at an advanced stage, and an indictment could come soon, according to the person familiar with the matter.

This time, however, the US Department of Justice' investigation isn't focusing on some grand national security threat but on the Huawei's repeated theft of trade secrets from US companies.

USA officials have briefed allies that Huawei is ultimately at the beck and call of the Chinese state, while warning that its network equipment may contain "back doors" that could open them up to cyber espionage. In a case brought forward in 2014, Huawei was charged with misappropriating robotic technology from one of T-Mobile's labs in Washington state.

In May 2017, a jury said Huawei should pay T-Mobile $US4.8 million ($6.69 million) in damages. Huawei is a national champion but has always been viewed with suspicion in Washington, with its equipment banned from American communications networks.

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"We're not going to comment on such reports in the press", Chase Skinner, a spokesman for Huawei, said late Wednesday.

- Establishing the enforcement of the U.S. export ban: Chinese telecommunications companies that violate United States export control laws or sanctions are prohibited from exporting US-made components. Both have also been accused of failing to respect US sanctions on Iran.

The Chinese company has already become a major part of the trade dispute between the USA and China.

Huawei is the world's biggest producer of telecommunications equipment. Last week, a company employee was arrested in Poland.

"Huawei is effectively an intelligence-gathering arm of the Chinese Communist Party whose founder and chief executive officer was an engineer for the People's Liberation Army", said Republican Senator Tom Cotton, one of the bill's sponsors.

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. As part of the agreement, the USA lifted a ban in place since April that prevented ZTE from buying the US components it heavily relies on to make smartphones and other devices.