Huawei and ZTE Threat to US National Security: Congressional Report

Created: 2012-10-08 12:52 EST

Category: Business
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If you’re a US company thinking about buying from Huawei, China’s largest telecom gear maker, “find another vendor if you care about your intellectual property; if you care about your consumers' privacy and you care about the national security of the United States of America.” That’s according to Mike Rogers, the chairman of the US House of Representatives Intelligence Committee. 
 
Last November, he and Congressman Dutch Ruppersberger lead an investigation into reports that Chinese telecommunication firms Huawei and ZTE had close ties with the Chinese regime and their business in the US would be a threat to national security. 
 
The committee released its findings of that investigation today.
 
Citing credible allegations from unnamed industry experts and employees from Huawei, both current and former, the panel said there was evidence that the company could be involved in bribery and corruption, discriminatory behavior and copyright infringement.
 
Huawei’s founder, Ren Zhengfei, started the company after leaving the Chinese army and his ties to the military has been of particular focus. According to US intelligence officials, China has been foremost in the world in its attempts at economic espionage against the United States. 
 
ZTE’s stock has fallen 48% this year, according to Bloomberg news, following the scrutiny it has received in the US. 
 
Both companies and China’s Foreign Ministry spokesman Hong Lei have publicly denounced the hearing as prejudiced and unfounded.