EU states allowed screen for 5G risks amid Huawei fears

European Union member states have the right to restrict China's Huawei and other telecoms equipment providers from core part of their networks, according to new guidelines published on Wednesday.

Telecoms equipment suppliers judged to be a security threat will be excluded from critical parts of 5G communications networks in the EU under a bloc plan drawn up in response to fears over Huawei.

The recommendations stop well short of a blanket ban on any company and leave each of the EU’s soon-to-be 27 member states with ultimate responsibility for devising their own specific security measures

The European Union has been under pressure from the US to bar Huawei fromaccess to 5G networks over security concerns. While going some way to appease the US, the European Commission has not backed a pre-emptive ban on the supplier.

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The commission on Wednesday endorsed a joint ‘toolbox’ of measures to address risks related to the roll-out of 5G. As part of this, member states have agreed to strengthen security requirements, including assessing suppliers such as Huawei.

Calling it a “non-biased and fact-based approach,” the Chinese company welcomed the EU’s announcement, which it said “enables Huawei to continue participating in Europe’s 5G roll-out.”

Blacklisted

Huawei is one of the world’s biggest providers of 5G equipment along with Sweden’s Ericsson and Finland’s Nokia. It is favoured by some countries as its equipment is cheaper than that of its rivals.

However, the company has been in the spotlight of late after being blacklisted by the US on national security grounds. The group has consistently denied allegations that its equipment can be used to spy on other countries and/or companies.

On Tuesday, the British government defied pressure from the US and gave the go-ahead for the company to have a limited role in its 5G networks.

While enabling individual member states from restricting Huawei and other suppliers from national networks, it stepped back from introducing a pre-emptive ban.

“We can do great things with 5G. The technology supports personalised medicines, precision agriculture and energy grids that can integrate all kinds of renewable energy. This will make a positive difference. But only if we can make our networks secure. Only then will the digital changes benefit all citizens,” said Margrethe Vestager, vice president of the European Commission for a Europe Fit for the Digital Age and commissioner for competition.

The new policy document urges EU member states to apply ad hoc restrictions on merit for certain suppliers of key 5G components, including core, network management, access network, and orchestration functions. The assessment criteria, already published in December, include “a strong link between the supplier and a government,” and the lack of “legislative or democratic checks and balances” in the home-country of the company.

Telecom operators welcomed the EU’s announcement but urged national governments “to avoid disproportionate actions that negatively impact the investment climate” as they implement the guidelines, ETNO, the association of some of Europe’s largest telecom operators, said in a statement. The operators added they would continue to pursue a “multi-vendor strategy.”

More than €1 billion has been spent on the introduction of 5G in Europe. By the end of this year, 5G services are expected to be available in 138 European cities.

Additional reporting: Financial Times Limited 2020/ loomberg