Huawei dismisses U.S. calls for probe of Iran business

Updated:2012/1/5 11:40

Huawei Technologies Co Ltd said on Wednesday that calls by six U.S. lawmakers to investigate whether the giant Chinese telecommunications equipment maker has violated a sanctions law by supplying sensitive technology to Iran were based on inaccurate media reports.

"Unfortunately, a few Members of Congress continue to cite inaccurate media reports that include groundless allegations," Huawei, the world's No.2 telecommunications gear maker, said in an emailed statement.

Huawei, founded by Chief Executive Ren Zhengfei, has been seeking to expand in the U.S. telecommunications sector, but has run into political opposition over national security concerns. Ren's background with the Chinese military has often been cited as hindering the company's progress in North America, although Huawei has repeatedly denied having any links with the armed forces.

In a letter to the U.S. Department of State, six U.S. lawmakers have called for a government investigation into whether Huawei and other telecommunications companies violated an Iran sanctions law passed by the U.S. Congress in 2010 by supplying sensitive technology to Iran.

The letter, which largely cited a Wall Street Journal report in October that the Iranian government used technology from Huawei and other companies to "restrict the speech of the Iranian people and the free flow of unbiased information in Iran," was dated December 22, but was only made public this week.

Huawei, China's biggest telecom equipment manufacturer, said on December 10 that it would not pursue new business in Iran after a U.S.-based watchdog said that the authorities in Tehran were using the company's equipment to monitor dissidents.

Huawei said at the time that it "will voluntarily restrict its business development (in Iran) by no longer seeking new customers and limiting its business activities with existing customers." [ID:nL3E7NA00N]

U.S. lawmakers also said in the letter that "Huawei's decision earlier this month to no longer pursue new business in Iran is a positive step," but the company's previous actions and continuing service of existing contracts with Iranian clients may violate the sanction.

Huawei also said on Wednesday that it had responded to similar allegations in November, saying that its work in Iran was for commercial and civilian use and that it did not have technology that could be used for news censorship. It also said that it was just one of many telecom equipment providers in Iran and was not the supplier in the country.

"The letter actually contains nothing new. I have forgotten how many times we have seen such allegations," said a source close to Huawei, who asked not to be identified because he was not authorized to speak to the public.

Huawei is jointly owned by its employees and is not listed.

Huawei, based in the southern boomtown of Shenzhen, competes with Samsung Electronics Co Ltd and Apple Inc in consumer electronics and with Ericsson and Cisco Systems Inc in telecommunications network gear.

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