The logo of Huawei Technologies is pictured in front of the German headquarters of the Chinese telecommunications giant in Duesseldorf

By David Ljunggren

OTTAWA (Reuters) - Canada, the only member of an elite intelligence-sharing network yet to decide whether to allow the use of Huawei Technologies Co Ltd 5G technology, on Tuesday said it was studying Britain's decision not to ban the Chinese telecoms giant from the West's next-generation communications.

Britain announced the firm could have a limited role in 5G mobile networks, resisting pressure from Washington. Huawei's involvement will be capped at 35% and it will be excluded from the sensitive core, where data is processed.

"Those are the solutions that are being examined," Innovation Minister Navdeep Bains told reporters when asked about Britain's steps.

"I'm not going to jump to any conclusion of what that solution may look like vis-a-vis core and non-core."

Bains, saying Canada would keep talking to allies, did not answer directly when asked about the timing of a decision.

Canadian sources said last year that Ottawa would closely study what Britain did.

Last November, a senior U.S. official told Canada that allowing Huawei 5G technology would threaten intelligence sharing with the Five Eyes network that also groups Britain, Australia and New Zealand.

The United States says Huawei equipment could be used to steal Western secrets, a charge the firm denies. New Zealand and Australia have banned domestic mobile networks from using Huawei 5G equipment.

Canadian telecommunications firms are increasingly impatient for Ottawa to make a decision.

"Although the security concerns are very significant, we also have to make sure we give full consideration to what is best for Canadians ... (and) the industry environment," Public Safety Minister Bill Blair told reporters.

The added complication for Canada is that Beijing detained two Canadians in 2018 after Vancouver police arrested a Huawei executive on a U.S. extradition warrant.

Two sources directly familiar with the matter said security officials were split over Huawei. The Communications Security Establishment (CSE) - which gathers signals intelligence - was taking a more dovish line than the Canadian Security Intelligence Service (CSIS) spy agency, they said.

"CSE considers this is a technical question that can be managed while CSIS is totally opposed to opening the door to possible espionage," said one source, who requested anonymity given the sensitivity of the situation. The split was first reported by the Globe and Mail newspaper.

In a statement, Huawei Canada said "in our ten years of operation in Canada, there has never been a security incident or a lapse of any sort".





(Reporting by David Ljunggren; Editing by Marguerita Choy)