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In Rebuke to the United States, Germany is considering letting Huawei In



BERLIN-The German government is similar to letting Huawei Technologies Co. Participating in building the nation's high-speed Internet infrastructure, several German officials said the last sign of ambivalence among US allies over Washington's pressure to eradicate the Chinese technological giant as a national security risk.

A small group of ministries reached a preliminary agreement two weeks ago that still needs formal approval from the entire cabinet and parliament. It is not expected for several weeks.

The Trump administration has pushed its allies for months to limit Huawei's participation in building its next-generation mobile infrastructure – or even pulling the equipment from existing networks.

But the reluctance of these countries to delay the roll-out of so-called 5G services, the possible additional costs of picking new suppliers, and the lack of evidence that Huawei can use the equipment to cancel or interfere with communications, has stymied the US efforts.

In U.K., Washington's closest allies in Europe, a review currently underway is expected to conclude that its products will still be allowed in less vulnerable parts of the network, according to British officials.

And over Eastern Europe, where the United States has traditionally suffered from major failures, governments have been reluctant to drastically limit Huawei's access, partly because this could counter China, a major investor in the region.

The German government has made changes to the country's telecommunications legislation, regardless of Huawei's concerns. While Berlin had first considered designing the rules in a way that would make it difficult for Huawei to provide infrastructure contracts, officials said that the stricter security requirements of equipment suppliers, including a non-spy obligation, should not be deliberately set as high as to exclude it Chinese company.

A recent probe from the German Security Agency with the help of the United States and other Allies failed to show that the Chinese company could use the equipment to clandestinely fill in data, according to senior agencies and other government officials.

An official at the Federal Office for Information Security, known as BSI, and two cyber security experts in the internal and foreign ministries said that the probe in Germany and others among Allies had not revealed any indication of failure in Huawei. [1

9659004] Germany is behind the rest of Europe – and most of Asia in Internet traffic, making a quick 5G rollout essential to enabling a range of new services such as aut onomous vehicles and high-resolution video streaming. German industry representatives also have a rapid roll-out, partly out of concern that China could retaliate by cutting German companies from the Chinese market.

"We missed the boat here in Germany with regard to broadband internet. We need the internet quickly, we need it quickly, and we need it cheaply," says a senior government officer involved in the case.

In addition to being the market leader in the network infrastructure components needed to build 5G networks, Huawei also offers lower prices than competitors – some German officials said they were involved in the government's preliminary decision not to eradicate it.

Another official said conversations with US and British Services thought to have more insight into possible vulnerabilities built into Huawei's equipment proved to be incomplete.

In Britain, government officials plan to conduct a telecommunications channel review by the spring, with the goal of deciding whether UK telecommunications networks are too dependent on Huawei , people known about the review.

The United States revealed sweeping charges against Chinese tech firm Huawei in January. WSJ's Shelby Holliday breaks down the charges.

U.K. officials share the American concern that Huawei could put their western rivals out and be the only option for telecom equipment in the near future, the people said. But unlike their American counterparts, British officials believe they can allow some Huawei equipment in the UK network, the people said.

British officials are considering allowing U.K. wireless operators to use only Huawei's mobile tower equipment, the people said. Such devices, unlike "core" networking devices that transmit calls and data, give minimal risk because an attacker could only access limited data, the people said. U.K. officials also consider that wireless operators should use several suppliers, the people said.

Huawei is already working closely with the German government. Last year, the company opened a security lab near BSI's head office in Bonn, where the authorities can review the company's products and source codes. A Huawei spokesman said the company supported stricter telecom security rules and would sign a no-spy deal.

This could violate Huawei's Chinese law. A Chinese law in 2017 states that all Chinese companies must cooperate with the country's intelligence services on demand, which Vice President Mike Pence warned in a speech in Germany this weekend, could compromise the security of communication on markets that allow Huawei.

Addressing the same event, Yang Jiechi, a Chinese foreign policy officer rejected the allegations and said that Huawei was cooperating with European companies.

"Chinese law does not require companies to install back doors … or spy," said Jiechi. [19659004] Berlin's preference for providing the Chinese supplier with access has given some withdrawal among a small group of politicians and officials who believe the government is undermining the security risk due to short-term economic considerations.

The group is also keen to open another dispute with the Trump administration, adding a list of flash points ranging from trade to Iran's nuclear agreement and Nord Stream 2, a German-Russian gas pipeline project Washington is determined to stop .

U.S. Ambassador in Germany Richard A. Grenell said that German political decision makers should consider that China gathered and exploited data on an unparalleled scale.

"They utilize a variety of legal tools and other mechanisms to exercise control and influence companies to work with Chinese intelligence and security services. This applies to both state-owned enterprises and apparently private firms," ​​says Grenell.

Huawei's Founder, Earlier Chinese military engineer Ren Zhengfei, told British broadcasters Monday that "there is no way the US can crush us … The world cannot leave us because we are more advanced. Even though they persuade more countries not to use us temporarily, we can always flatten things a little. "

" If the lights go out in the West, the east will still shine, "he added." And if the north gets dark, it's still south. America does not represent the world. America represents only part of the world. "

Write to Bojan Pancevski at bojan.pancevski@wsj.com and Sara Germano at sara.germano@wsj .net


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