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September 22, 2017

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Paper by China's Huawei decries US treatment

WASHINGTON -- U.S. lawmakers on Thursday will question executives of two major Chinese technology companies as part of a congressional probe into whether those firms' ambitions to carve out a bigger niche in the American market pose a threat to national security.

The House Intelligence Committee is probing Huawei Technologies Ltd., which was founded by a former Chinese military engineer and has grown to become the world's second-largest supplier of telecoms network gear. Also under scrutiny is its rival ZTE Corp., which is partly state-owned and is the world's fourth largest mobile phone manufacturer.

Lawmakers fear the companies could pose an espionage risk. Those concerns have hampered Huawei and ZTE's expansion in the U.S., particularly beyond selling mobile devices to the provision of network infrastructure. They deny being a security threat.

The committee is expected to finalize its investigation in early October.

Thursday's hearing might also raise with ZTE alleged sales of banned U.S.-sanctioned computer equipment to Iran. The company is facing a Commerce Department investigation into such sales, and the FBI is probing allegations the company obstructed that investigation.

ZTE says it welcomes the hearing as an opportunity to respond to criticism that associates them directly with the Chinese government and competitor companies. They also want to provide security assurances to enable their entry into the lucrative U.S. network infrastructure market.

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