LDN - Business

Germany set to ban China's Huawei, ZTE from parts of 5G networks -source

[March 07, 2023] By Sarah Marsh and Andreas Rinke

BERLIN (Reuters) -Germany plans to ban telecoms operators from using certain components made by Chinese companies Huawei and ZTE in 5G networks, a government source said, in a potentially significant move to address security concerns.

The German ban could include components already built into the networks, requiring operators to remove and replace them, German media had reported on Monday, citing sources.

A spokesperson for the interior ministry confirmed that the German government, which is in the midst of a broader re-evaluation of its relationship with top trade partner China, was carrying out a general review of telecoms tech suppliers.

No operators had however yet been banned from using certain components from Chinese companies in their 5G networks, the spokesperson said.

"The main change is that these strict checks for potential security risks now also apply to the existing components in telecommunications networks," the spokesperson said, adding that operators would not be compensated for parts that needed to be ripped out of the network and replaced.

An interior ministry paper on the review obtained by Reuters said that a specific supplier could be banned from providing critical components if it were deemed to be directly or indirectly controlled by the government of another state.

"This is a sign that the German government may finally be taking China-related risks to national security seriously" said Noah Barkin, managing editor with research firm Rhodium Group's China practice who specialises in German-Chinese relations.

"But after years of dithering, the German 5G network is deeply dependent on Chinese suppliers. It will take many years to unwind this," Barkin added.

Critics of Huawei and ZTE say that their close links to Beijing's security services mean that embedding them in the ubiquitous mobile networks of the future could give Chinese spies and even saboteurs access to essential infrastructure.

Huawei, ZTE and China's government reject these claims, saying that they are motivated by a protectionist desire to support non-Chinese rivals.

A Huawei spokesperson said it did not comment on speculation and said it had a "very good security record" during its 20 years of delivering technology to Germany and the rest of the world. ZTE did not immediately reply to a request for comment.

While several countries across Europe are still formulating telecom policies, only Britain and Sweden have so far banned Huawei and ZTE from supplying critical 5G network equipment.

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An employee uses a Huawei P40 smartphone at the IFA consumer technology fair, amid the coronavirus disease (COVID-19) outbreak, in Berlin, Germany September 3, 2020. REUTERS/Michele Tantussi/File Photo

"The devil is in the details, it would be a major step forward if this included all access network components where operators have made excessive use of Huawei in recent years," said Thorsten Benner, China expert and director of the Global Public Policy Institute in Berlin.

Germany passed an IT security law in 2021 setting high hurdles for makers of telecommunications equipment for next-generation networks, but stopping short of banning Huawei and ZTE as some other countries have done.

A new report shows that Germany has actually become even more dependent on Huawei for its 5G radio access network equipment (RAN) than in its 4G network, even though operators have avoided using the firm's technology for the core networks.

GERMANY LAGGING

Zeit Online said Berlin's cybersecurity agency and interior ministry had for months been checking if there were components in the growing 5G networks that could put its security at risk.

The survey had not officially been ended, but the result was already clear, Zeit Online said, citing government sources. The government would ban operators from using certain controlling elements from Huawei and ZTE in 5G networks.

"It sounds like a step in the right direction but it comes way too late," said Benner. "We've had 4.5 years of serious debate on Huawei and 5G, and still not come to a conclusion."

The German government was last month unable to answer a recent parliamentary request about how many Huawei components operators were using in their 5G networks.

Sweden's telecom regulator PTS, which in 2020 banned Chinese companies from rolling out 5G, gave telecom operators taking part in 5G auctions until Jan. 1, 2025 to remove gear from China from their infrastructure and core functions.

Britain, meanwhile, wants telecom firms to remove equipment and services from Huawei in core network functions by Dec. 31, 2023, from an original target of Jan. 28, 2023.

The deadline to remove all Huawei gear from Britain's 5G networks by the end of 2027 remains unchanged.

(Reporting by Sarah Marsh, Andreas Rinke and Friederike Heine; Additional Reporting by Supantha Mukherjee; Editing by Nick Zieminski, Tomasz Janowski, Alexander Smith and Emelia Sithole-Matarise)

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