National Security and Chinese Telecommunications Companies

Sunday, October 14, 2012

Stefano Mele

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The U.S. House Intelligence Committee released a report recommending to U.S. companies considering doing business with Chinese telecommunications companies Huawei and ZTE to find "another vendor".

Additionally, the report recommends that U.S. government systems, particularly sensitive systems, exclude Huawei or ZTE equipment or component parts.

The report comes after a year-long investigation into the national security dangers posed by Huawei and ZTE, the two largest Chinese telecommunications companies doing business in the United States.

The report includes five recommendations:

1. US government systems and US government contractors, particularly those working on sensitive systems, should exclude any Huawei or ZTE equipment or component parts.  Additionally, the Committee on Foreign Investments in the United States (CFIUS) must block acquisitions, takeovers, or mergers involving Huawei and ZTE given the threat to U.S. national security interests.

2. U.S. network providers and systems developers are strongly encouraged to seek other vendors for their projects.

3. Unfair trade practices of the Chinese telecommunications sector should be investigated by committees of jurisdiction in U.S. Congress and enforcement agencies in the Executive Branch.  Particular attention should be paid to China’s continued financial support of key companies.

4. Chinese companies should quickly become more open and transparent. Huawei, in particular, must become more transparent and responsive to U.S. legal obligations.

5. Committees of jurisdiction in Congress should consider potential legislation to better address the risk posed by telecommunications companies with nation-state ties or otherwise not clearly trusted to build critical infrastructure, including increasing information-sharing among private sector entities and expanding a role for the CFIUS process to include purchasing agreements.

Read the report here:

For a full comprehension of the issue, see also the 2011 "Communist Chinese Cyber–attacks, Cyber–espionage and Theft of American Technology":

And the 2009 "Capability of the People’s Republic of China to Conduct Cyber Warfare and Computer Network Exploitation":

%20Report_16Oct2009.pdf

Cross-posted from Stefano Mele

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