According to a report from Reuters, a US government investigation has found no indication that network equipment supplier Huawei has been collaborating with Chinese intelligence services. However, the report says that the company's products contain security holes, and that this makes them hazardous to use in telecommunications networks. Citing government sources, Reuters reports that the previously undisclosed government paper, which was completed in early 2012, is the result of 18 months of investigation by the US government and various intelligence services.

The White House has denied that it commissioned such a report. "The Reuters report, based solely on anonymous sources, is not correct: the White House has not conducted any classified inquiry that resulted in clearing any telecom equipment supplier, including Huawei" said Deputy White House Press Secretary Josh Earnest in a statement to eWeek adding: "in fact, last October, Huawei was excluded from taking part in the building of America’s interoperable, wireless emergency network for first responders due to U.S. Government national security concerns."

Chinese network equipment suppliers Huawei and ZTE are facing pressure across Europe and in the US. On the one hand, their efforts to establish themselves in Western markets have been hampered by government security concerns. On the other hand, there are worries that these Chinese companies, which benefit from generous state subsidies, could use price dumping to score against Western competitors such as Cisco, Ericsson or Nokia Siemens Networks. The European Commission was also reportedly pondering an investigation of Huawei and ZTE.

The Chinese have repeatedly rejected the espionage and dumping accusations. The US government's investigation results seem to confirm that the fear of any backdoors in Huawei routers is unfounded. The EU Commission has launched no official investigation against Huawei and ZTE either. According to Financial Times Deutschland, the Chinese government has started to cooperate with the EU Commission to help address the allegations.

Although the US government's report may have invalidated the direct accusations of espionage against Chinese hardware manufacturers for the time being, government security agencies remain sceptical. The experts also warn that the security holes could be exploited by intelligence services. Glaring security holes in Huawei routers were described by Berlin-based security experts Felix Lindner and Gregor Kopf over the summer.

(fab)