Reuters

Australia is preparing to ban Huawei Technologies Co Ltd from supplying equipment for its planned 5G broadband network after its intelligence agencies raised concerns that Beijing could force the Chinese telco to hand over sensitive data, two sources said.

Western intelligence agencies have for years raised concerns about Huawei’s ties to the Chinese government and the possibility that its equipment could be used for espionage. But there has never been any public evidence to support those suspicions.

Huawei, the world’s largest maker of telecommunications network gear and the No. 3 smartphone supplier, has promised that Canberra will have complete oversight of 5G network equipment, which could include base stations, towers and radio transmission equipment.

That sort of oversight model has been accepted by other countries – notably the U.K., where a special laboratory staffed with government intelligence officials reviews all Huawei products.

Other Western countries, including the New Zealand, Canada and Germany, also say they have sufficient safeguards for assuring that Huawei equipment does not contain “back doors” or other mechanisms for secretly monitoring or collecting information.

But Australian intelligence agencies have told lawmakers that oversight will not allay their concerns, two political sources who have been briefed on the matter told Reuters.

“It is a Chinese company, and under Communist law they have to work for their intelligence agencies if requested,” said one of the government sources. “There aren’t many other companies around the world that have their own political committees.”

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